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14 December 2020
The United States Reaches a Settlement with the United Auto Workers Union to Reform the Union and End Corruption and FraudRead the Press Release
DETROIT – United States Attorney Matthew Schneider announced that an agreement has been reached with the United Auto Workers Union (UAW) to resolve the office’s findings of fraud and corruption within the UAW.
Schneider was joined in the announcement by UAW International President Rory Gamble.
Today, the United States filed an anti-corruption and anti-fraud civil lawsuit against the UAW in federal district court seeking equitable relief to bring about reform and oversight of the union. Also today, the parties jointly filed a proposed Consent Order setting forth the terms of a settlement of the lawsuit. Under the terms of the proposed settlement, the Court would appoint an Independent Monitor who would have the authority to exercise disciplinary powers within the UAW, to investigate possible fraud or corruption within the union, and to seek discipline against UAW officers and members before a UAW Trial Committee, or before an Independent Adjudications Officer also appointed by the Court. The Monitor’s oversight of the union would last for six years, with a possible early termination if the Monitor were to find that his or her work is complete and the UAW no longer needs the Monitor’s services, or extension if the Monitor or the parties feel that a longer period is appropriate. Besides the Monitor, the UAW will conduct a binding and secret-ballot referendum of its membership, overseen by the Monitor and the Department of Labor, to determine whether to change the UAW’s election method from the current delegate system to a direct election model, where the entire UAW membership could vote for the UAW President and the other members of the UAW’s International Executive Board. Through the referendum, members would decide whether the UAW’s constitution would be changed to provide for a direct election system in the union, sometimes referred to as “one member, one vote,” starting in the 2022 election cycle. The parties have jointly proposed the referendum so that all of the men and women of the UAW—and not the government—can decide the method to elect the union’s leaders. The costs associated with the Monitor would be borne by the UAW. The Monitor’s duties would not include any involvement in the collective bargaining process or the day-to-day administration of those contracts, absent any indication of corruption or fraud. The UAW’s board would continue to oversee collective bargaining negotiations and enforcement going forward.
The proposed settlement fully and finally resolves the criminal and civil investigation of the UAW as an entity. The UAW also agrees to resolve a tax investigation by making a payment of $1.5 million to the Internal Revenue Service in connection with administrative fees that the union received from the three joint training centers that were operated with the three car manufacturers. In addition, the UAW has already paid back over $15 million to the training centers for improper chargebacks that the union received from two of the training centers. This money will be used by joint programs for the health and safety of auto workers.
The civil complaint filed today in the United States District Court for the Eastern District of Michigan was brought pursuant to the federal civil anti-corruption and anti-fraud statute (18 U.S.C. § 1345), which was designed by Congress to empower courts to intervene and provide injunctive and equitable relief to eliminate fraud in order to serve the public interest. The civil lawsuit was not filed pursuant to the federal anti-racketeering RICO law because the investigation by the United States did not uncover any involvement by organized crime or the mafia in the operations of the UAW. Instead, the civil complaint sets forth in detail a series of corrupt and fraudulent acts by former officers and board members of the UAW, as well as executives of Fiat Chrysler Automobiles. The criminal investigation by the United States revealed an extensive and long-lasting effort by two former UAW presidents and their underlings to embezzle over $1.5 million in UAW money for their personal benefit through a series of fraud schemes. The investigation also uncovered a scheme by one former UAW vice president and two other high-level UAW officers to demand and accept over $2 million in kickbacks from contractors to the joint UAW-GM training center involving multi-million dollar contracts for watches, backpacks, and jackets. The civil complaint alleges that high-level Fiat Chrysler executives paid bribes to, and engaged in embezzlement with, two former UAW vice presidents and other UAW officials amounting to over $3.5 million. In total, fifteen UAW officials and Fiat Chrysler executives have been convicted thus far during the criminal investigation.
United States Attorney Schneider said, “The men and women of the UAW deserve honest and faithful leaders dedicated to serving the best interests of the membership. Today’s settlement provides independent oversight to investigate and eliminate corruption within the union. It also brings real democratic change to the union by giving the membership the opportunity to decide for themselves whether to institute a direct election system. I am truly thankful to President Rory Gamble for his good faith willingness to press for real reform within the union.”
UAW President Rory Gamble said, “Today’s agreement builds upon the many reforms that the UAW has initiated and put in place ourselves over the past 13 months. This civil resolution brings to a close the government’s investigation and is testament to the hard work that has been done to make the necessary structural and cultural changes.
Under our current leadership, the UAW has proactively weeded out individuals who put their personal benefit over our members’ interests and who abused their positions of trust to defraud our Union and our membership. Those individuals have been charged internally and permanently expelled from the Union.
Over the past year, the UAW’s International Executive Board has also devoted an extraordinary amount of time, attention, and resources to significantly overhauling and strengthening both our financial and ethical controls – all to ensure that no one in our Union will have the ability to repeat these misdeeds of the past.
The entire leadership of the UAW embraces the involvement of a Monitor for a period of time who will provide an extra and independent set of eyes on our Union’s financial and disciplinary processes, and provide complete assurance to our members that the reforms we have initiated take permanent root. We are committed to making the Monitor’s job a boring one, by doing everything we can to make sure there are no financial or ethical misconduct issues to monitor.
As I said upon taking office, my overriding goal is to deliver a clean, reformed and ethical union to my successor. Today’s collaborative agreement with the government ensures that we are well on our way toward achieving that goal.“
“Today’s settlement affirms the U.S. Department of Labor Office of Inspector General’s commitment to protect union workers and the financial integrity of labor organizations. We will continue to work with our law enforcement partners to root out systemic corruption and fraud involving unions,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
“For unions to be effective, members must trust their leadership to do what is best for the entire union and not just for themselves. The 15 convictions obtained during this years-long investigation make it clear UAW leadership has been unworthy of its members’ trust for some time,” said Timothy Waters, Special Agent in Charge of the FBI in Michigan. “This agreement is a result of the hard work done by the FBI, IRS, Department of Labor, and the US Attorney’s Office to investigate and prosecute the leaders who were engaged in corruption at the UAW. We remain proud of that work and hope the steps announced today will create a union worthy of the hard working men and women of the UAW.”
“Today marks a new beginning for the UAW and its members,” said Sarah Kull, Special Agent in Charge of the Internal Revenue Service – Criminal Investigation’s Detroit Field Office. “The UAW’s willingness to accept oversight confirms its commitment to eliminate systemic corruption within the union and regain the trust of its members.”
“Rarely since widespread corruption among the labor movement led to multiple Congressional investigations, numerous indictments and convictions, and strict new federal laws, have there been so many indications of widespread embezzlement, kickbacks, extortion, and graft. I am pleased that the Office of Labor-Management Standards was able to help bring an end to this exploitation of hardworking union members,” said Thomas Murray, District Director, U.S. Department of Labor, Office of Labor-Management Standards. “The Office of Labor-Management Standards stands ready to assist the Monitor and the Adjudications Officer in carrying out their duties and to help usher the UAW forward into this new chapter.”
The fifteen individuals convicted of fraud and corruption crimes include former UAW Vice President Joseph Ashton (30 months in prison) former FCA Vice President for Employee Relations Alphons Iacobelli (66 months in prison), former FCA Financial Analyst Jerome Durden (15 months in prison), former Director of FCA’s Employee Relations Department Michael Brown (12 months in prison), former senior UAW officials Virdell King (60 days in prison), Keith Mickens (12 months in prison), Nancy A. Johnson (12 months in prison), Monica Morgan, the widow of UAW Vice President General Holiefield (18 months in prison), former UAW Vice President Norwood Jewell (15 months in prison), and former senior UAW official Michael Grimes (28 months). In addition, the following UAW officials have pleaded guilty and are awaiting sentencing: former UAW President Gary Jones, former senior UAW official Jeffrey Pietrzyk, former UAW Region 5 Director and UAW Board member Vance Pearson, former UAW Midwest CAP President Edward “Nick” Robinson, and former UAW President Dennis Williams.
U.S. Attorney Schneider commended the outstanding work of the Internal Revenue Service – Criminal Investigations, the U.S. Department of Labor – Office of Labor-Management Standards and Office of Inspector General, and the Federal Bureau of Investigation in conducting a comprehensive criminal investigation into labor corruption activities involving a vital sector of the local and national economy.
Syracuse Postal Carrier Charged with Discarding MailRead the Press Release
SYRACUSE, NEW YORK – Tanner Brown, 24, of Sharon Springs, New York, has been charged by indictment with one felony count of detaining and delaying U.S. mail, announced Acting United States Attorney Antoinette T. Bacon and Special Agent in Charge Matthew Modafferi, United States Postal Service Office of Inspector General (USPS-OIG), Northeast Area Field Office.
Brown was arraigned today in federal court in Syracuse, before United States Magistrate Judge Thérèse Wiley Dancks and was released pending a jury trial to be scheduled in the future. The indictment alleges that Brown, while working as an employee of the United States Postal Service, detained and delayed mail intended for delivery between January 1, 2019, through July 24, 2019, in Onondaga County, New York.
The charge filed against Brown carries a maximum sentence of five years in prison, a fine of up to $250,000, and a term of supervised release of up to three years. A defendant’s sentence is imposed by a judge based on the particular statute the defendant is charged with violating, the U.S. Sentencing Guidelines and other factors.
The charges in the indictment are merely accusations. The defendant is presumed innocent unless and until proven guilty.
This case is being investigated by the United States Postal Service-Office of Inspector General, and it is being prosecuted by Assistant U.S. Attorney Michael F. Perry.
Sussex County Man Charged with Fraudulently Obtaining $5.6 Million Loan Meant to Help Small Businesses During COVID-19 PandemicRead the Press Release
NEWARK, N.J. – A Sussex County, New Jersey, man will make his initial court appearance today on charges of fraudulently obtaining a federal Paycheck Protection Program (PPP) loan of over $5 million, U.S. Attorney Craig Carpenito announced.
Azhar Sarwar Rana, 30, of Newton, New Jersey, is charged by complaint with one count of bank fraud and one count of money laundering. Rana was arrested Dec. 12, 2020, after he booked a same-day flight to Pakistan; he made his initial appearance by videoconference today before U.S. Magistrate Judge James B. Clark III and was detained without bail.
According to documents filed in this case and statements made in court:
Rana submitted a fraudulent PPP loan application to a lender on behalf of a corporate entity, Azhar Sarwar Rana LLC, that purportedly invested in real estate development. The application falsified payroll and tax information and included internally inconsistent listings of the number of company employees. New Jersey Department of Labor records showed that Azhar Sarwar Rana LLC paid no wages in 2019, and the minimal wages it purportedly paid in 2020 were mostly to individuals whose submitted Social Security numbers did not correspond to their submitted names.
Based on Rana’s alleged misrepresentations, the lender approved Rana’s PPP loan application and provided Azhar Sarwar Rana LLC with an approximately $5.6 million in federal COVID-19 emergency relief funds meant for distressed small businesses.
Rana used the fraudulently obtained PPP loan proceeds to pay for numerous personal expenses, including to invest millions in the stock market, make a payment to a luxury car dealership, and send hundreds of thousands of dollars to accounts in Pakistan.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted March 29, 2020. It is designed to provide emergency financial assistance to millions of Americans who are suffering the economic effects resulting from the COVID-19 pandemic. One source of relief provided by the CARES Act is the authorization of up to $349 billion in forgivable loans to small businesses for job retention and certain other expenses through the PPP. In April 2020, Congress authorized over $300 billion in additional PPP funding.
The PPP allows qualifying small businesses and other organizations to receive loans with a maturity of two years and an interest rate of 1 percent. Businesses must use PPP loan proceeds for payroll costs, interest on mortgages, rent and utilities. The PPP allows the interest and principal to be forgiven if businesses spend the proceeds on these expenses within a set time period and use at least a certain percentage of the loan towards payroll expenses.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch Jr. in Newark; special agents of IRS – Criminal Investigation, under the direction of Special Agent in Charge Michael Montanez; special agents of the Social Security Administration – Office of the Inspector General, under the direction of Special Agent in Charge John F. Grasso; and special agents of the U.S. Department of Homeland Security, Homeland Security Investigations, under the direction of Special Agent in Charge Jason J. Molina in Newark, with the investigation leading to the charges.
The count of bank fraud carries a maximum potential penalty of 30 years year in prison and a $1 million fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater; the count of money laundering carries a maximum potential penalty of 10 years in prison and a $250,000 fine, or twice the gross gain to the defendant or gross loss to the victim, whichever is greater.
The government is represented by Assistant U.S. Attorney Andrew Macurdy of the U.S. Attorney’s Office Economic Crimes Unit in Newark.
Anyone with information about allegations of attempted fraud involving COVID-19 can report it by calling the Department of Justice’s National Center for Disaster Fraud Hotline at 866-720-5721 or via the NCDF Web Complaint Form at: https://www.justice.gov/disaster-fraud/ncdf-disaster-complaint-form.
The charges and allegations contained in the complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.
Stoughton Man Pleads Guilty to Drug Distribution ChargesRead the Press Release
BOSTON – A Stoughton man with ties to the Orchard Gardens housing development in Roxbury pleaded guilty today in federal court in Boston to drug trafficking charges.
Dashawn Matthews, 31, pleaded guilty to distribution and possession with intent to distribute fentanyl and cocaine base (also known as crack cocaine). U.S. District Court Judge William G. Young scheduled sentencing for April 6, 2021.
During an investigation into drug trafficking and violence in the Orchard Gardens housing development, a cooperating witness and an undercover police officer made eight purchases of fentanyl, crack cocaine or both from Matthews. In total, between May and August 2019, Matthews distributed approximately 120 grams of fentanyl and 98 grams of crack cocaine. Most of the sales took place a short distance away from the Orchard Gardens housing development.
The charge of distribution and possession with intent to distribute fentanyl and cocaine base provides for a sentence of up to 20 years in prison, at least three years of supervised release and a fine of up to $1 million. Sentences are imposed based upon the U.S. Sentencing Guidelines and other statutory factors.
United States Attorney Andrew Lelling; Kelly D. Brady, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Boston Field Division; and Boston Police Commissioner William Gross made the announcement today. Assistant U.S. Attorney Christopher Pohl of Lelling’s Narcotics and Money Laundering Unit is prosecuting the case.
Smuggler of Protected Sea Cucumbers Sentenced to Six Months in CustodyRead the Press Release
Assistant U. S. Attorney Melanie K. Pierson (619) 546-7976
NEWS RELEASE SUMMARY – December 14, 2020
SAN DIEGO – Tijuana resident John Jaimes Torres was sentenced in federal court today to six months in custody for smuggling protected sea cucumbers valued at more than $60,000 into the United States.
In November of 2019, Torres was discovered with 101 undeclared packages of sea cucumbers, totaling 145 kilograms, concealed in, under, and behind toolboxes in the bed of his truck. The sea cucumbers were of the species Isostichopus fuscus, which is protected under the Convention on International Trade in Endangered Species (CITES). In order to lawfully import these sea cucumbers, a CITES import/export permit and CITES certificate of origin was required, as well as an import/export license from the U.S. Fish and Wildlife Service, none of which Torres possessed.
As noted in court proceedings, in addition to the sea cucumbers, Torres possessed four cell phones. A search of these phones revealed evidence of prior smuggling events. For example, in July of 2019, Torres delivered more than 20 bags of sea cucumbers to a storage unit in the San Diego area. He sent a photo of the sea cucumbers in the storage unit to his client.
The search of the phones also indicated that Torres was an all-service smuggler, crossing food products, alcohol, medications and cigarettes in addition to the sea cucumbers, for profit. At the time he crossed the border, Torres was in possession of $1,600 in cash. In addition to the custodial sentence, Torres was also ordered to make restitution of $10,000 to the government of Mexico as compensation for the loss of its natural resources. Torres was ordered to self-surrender to begin serving his sentence on or before February 12, 2021.
“Scientists tell us that sea cucumbers play a critical role in keeping coral reef and other tropical ocean ecosystems healthy,” said U.S. Attorney Robert Brewer. “Unfortunately the black market for sea cucumbers is thriving, making these cases against smugglers even more important.” Brewer praised prosecutor Melanie Pierson and agents with U.S. Fish and Wildlife Service, Office of Law Enforcement and Homeland Security Investigations and Customs and Border Protection for their excellent work on this case.
“The unlawful commercialization of living marine faunae, such as CITES-protected sea cucumbers, not only harms the individual species, but it promotes the destruction of ocean ecosystems that other wildlife depend on for survival,” said special agent in charge Dan Crum. “Today's sentencing sends a message that our law enforcement agents and prosecutors will continue to investigate, prosecute and bring to justice any violators who illegally exploit wildlife for profit.”
“The illegal sea cucumber trade is a real problem, and illicit trafficking in protected species fuels crime and decimates protected wildlife populations,” said Cardell T. Morant, Special Agent in Charge of Homeland Security Investigations. “This arrest and conviction demonstrates our commitment to work with our law enforcement partners to protect threatened and endangered species and bring justice to the criminals that seek to profit from their exploitation.”
DEFENDANT Case Number 19cr4848-W
John Jaimes Torres Age: 52 Tijuana, Mexico
SUMMARY OF CHARGES
Count 1
Conspiracy – Title 18, U.S.C., Sec. 371
Maximum penalty: Five years in prison and $250,000 fine
Counts 2-5
Smuggling/Importation Contrary to Law – Title 18, U.S.C., Sec.545
Maximum Penalty: Twenty years in prison and $250,000 fine
AGENCY
U.S. Fish and Wildlife Service, Office of Law Enforcement
Homeland Security Investigations
Customs and Border Protection
Six Charged in Frequent Flier FraudRead the Press Release
Six men have been charged with stealing millions of airline frequent flier miles, announced U.S. Attorney for the Northern District of Texas Erin Nealy Cox.
A federal grand jury indicted Wojciech Borkowski (43, of Zgierz, Poland), Terran Oliver (51, of Allen, TX), Semaj Lee (55, of Oklahoma City, OK), Derrick Booker (49, of Spencer, OK), Yusuf Siddique (30, of Folsom, CA), and Stanley Benton (42, of Los Angeles, CA) on conspiracy to commit wire fraud in August 2019.
The lead defendant, Mr. Borkowski, was arrested in Poland in May 2020. Following a successful extradition request, he was handed over to FBI custody on Friday morning, and flown from Warsaw to Dallas over the weekend. He made his initial appearance before Magistrate Judge Renee Harris Toliver Monday morning.
According to the indictment, Mr. Borkowski allegedly hacked into consumers’ airline miles accounts, then used the compromised accounts to book flights for unsuspecting passengers who’d purchased travel through Mr. Oliver, Mr. Lee, Mr. Booker, Mr. Siddique, and Mr. Benton.
The U.S.-based passengers would send their requested itinerary and personal information, including names and dates of birth, to one of the five men, who would then send that information, along with a money order, to Mr. Borkowski. Mr. Borkowski would then book the passenger’s flight with fraudulently obtained miles and send the PRN number back to the men, who would transmit it to the passengers to generate a boarding pass.
The conspiracy involved the loss of millions of earned airline miles.
An indictment is merely an allegation of criminal conduct, not evidence. All defendants are presumed innocent until proven guilty.
If convicted, Mr. Borkowski and his coconspirators each face up to 20 years in federal prison.
The Federal Bureau of Investigation’s Dallas Field Office conducted the investigation. The extradition from Poland was secured through the Justice Department’s Office of International Affairs. Assistant U.S. Attorney Sid Mody is prosecuting the case.
Sioux Falls Man and Woman Sentenced for Meth Trafficking ConspiracyRead the Press Release
United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man and woman convicted of Conspiracy to Distribute a Controlled Substance were sentenced on November 16, 2020, and December 7, 2020, respectively, by U.S. District Judge Karen E. Schreier.
Darren Anthony Hendrix, age 29, was sentenced to 196 months in federal prison, followed by 5 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Rachel Anne Cooke, age 38, was sentenced to 60 months in federal prison, followed by 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Hendrix and Cooke were indicted by a federal grand jury on March 10, 2020. Hendrix pled guilty on August 26, 2020. Cooke pled guilty on September 15, 2020.
The conviction stemmed from incidents beginning at an unknown date and continuing until about January 9, 2020, when Hendrix, Cooke, and other co-conspirators intentionally conspired and obtained 500 grams or more of methamphetamine and distributed it to others in the District of South Dakota. Methamphetamine is a Schedule II controlled substance.
This case was investigated by the Sioux Falls Area Drug Task Force, the Department of Homeland Security, and the U.S. Postal Inspection Service. Assistant U.S. Attorney Jennifer D. Mammenga prosecuted the case.
Hendrix was immediately turned over to the custody of the U.S. Marshals Service.
Cooke has been allowed to self-report to the designated BOP facility by January 28, 2021.
Sioux Falls Man Sentenced for being a Felon in Possession of a FirearmRead the Press Release
United States Attorney Ron Parsons announced that a Sioux Falls, South Dakota, man convicted of Felon in Possession of a Firearm was sentenced on December 7, 2020, by U.S. District Judge Karen E. Schreier.
Curtis Ronald Rabenberg, age 39, was sentenced to 33 months in federal prison, followed by 3 years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Rabenberg was indicted by a federal grand jury on July 20, 2020. He pled guilty on September 14, 2020.
The conviction stemmed from an incident on or about November 19, 2019, when Rabenberg sold a stolen handgun to a pawn shop in Sioux Falls. Rabenburg had previously been convicted of a felony and was prohibited from possessing any firearms. He stole the firearm from a girlfriend and sold it for cash to pay a debt he owed for drugs.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department of Justice reinvigorated PSN in 2017 as part of its renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
This case is also part of Project Guardian, the Department of Justice's signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department's past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see: https://www.justice.gov/projectguardian.
This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Sioux Falls Police Department. Assistant U.S. Attorney Jeffrey C. Clapper prosecuted the case.
Rabenberg was immediately turned over to the custody of the U.S. Marshals Service.
Seven Charged in Largest Meth Seizure in Warren County HistoryRead the Press Release
BOWLING GREEN, Ky. – Seven defendants have been charged in a conspiracy to deal a large quantity of methamphetamine in the Bowling Green area, announced United States Attorney Russell Coleman.
“Relationships matter especially in law enforcement, when collaboration is needed to defend our families from the volume of poison that traffickers are pouring into West Kentucky,” said U.S. Attorney Russell Coleman. “That is exactly why we opened a fully-staffed office of federal prosecutors in Bowling Green earlier this year, to work with some of the finest lawmen and women in our Commonwealth to better protect Southcentral Kentucky.”
“This case resulted in the largest crystal meth seizure in Warren County history. These cases are not possible without a team effort of our state, local and federal partners,” said Tommy Loving, the Executive Director of the Bowling Green/Warren County Dug Task Force. “Our local detectives partnering with the FBI shut down a major supplier of crystal meth and his drug trafficking organization. The US Attorney’s office worked with us from the early stages of this case to help bring it to fruition. The Bowling Green Police, Kentucky State Police, Warren County Sheriff’s Office, and WKU Police all participated in the joint investigation with the FBI.”
According to the indictment, beginning June 11, 2020, and continuing to on or about August 30, 2020, the seven defendants: Tyrecus J. Crowe, George Sanchez, Andre M. Graham, Michael D. Padilla, Raymond Derouse Jr., Jeremy Quezada, and Brandon Cherry, conspired to possess with intent to distribute methamphetamine. Derouse, Quezada, and Cherry all face additional counts for possession with intent to distribute a controlled substance: methamphetamine.
An accompanying affidavit in support of a federal criminal complaint gives more details surrounding the alleged conduct. According to the document, on July 24, 2020, the Texas Department of Public Safety (DPS) stopped a white Chevrolet Tahoe for speeding. A driver and two passengers occupied the Tahoe. The driver consented to have the DPS search the vehicle. That consent search uncovered approximately 40 pounds of suspected crystal methamphetamine hidden in a black bag. The search also revealed a rental agreement between the rental company and Tyrecus Crowe. The DPS detained the driver and.contacted the Drug Enforcement Administration (DEA). A special agent with the DEA met the driver and advised the driver of his rights. After receiving his Miranda warnings, the driver agreed to speak with the DEA special agent. The driver explained he was driving the rented car from California to Bowling Green, Kentucky to deliver the crystal methamphetamine to Tyrecus Crowe. The driver stated Crowe rented the vehicle and let the driver use it for this trip. The driver further stated this was his second trip to California to pick up crystal methamphetamine for Crowe. The first trip occurred approximately one week prior. At the end of that trip, the driver successfully delivered approximately 25 pounds of crystal methamphetamine to Crowe's residence in Bowling Green.
During a July 26, 2020 interview, the driver stated that during both trips, Crowe provided the driver with cash to deliver in California. Once in California, the driver met George Sanchez at a pre-determined location in Los Angeles, California. Sanchez met the driver, then the two traveled together in Sanchez's vehicle to a residence relatively close to the initial meeting location. Sanchez and the driver hand counted the money, then Sanchez weighed the money on a scale. The driver did not remember how much money he transported the first trip, but Crowe gave the driver $105,000 in cash during this second trip. The driver gave Sanchez the $105,000 and Sanchez then gave the driver the crystal methamphetamine and drove him back to the driver's vehicle.
If convicted at trial, the defendants face no less than 10 years and no more than life in federal custody. The United States has also filed notice to seek forfeiture from the defendants named to include:$57,000 in cash, a residence in Bowling Green, 2008 Ford Mustang, 2012 Nissan Altima, 2001 Impala, and a 2015 Maserati Ghibli.
A federal complaint is a written statement of the essential facts of the offense charged and must be made under oath before a United States Magistrate Judge. The charge set forth in a complaint is merely an accusation and the defendant is presumed innocent until proven guilty.
The case is being prosecuted by Assistant United States Attorney Mark Yurchisin of the U.S. Attorney’s Bowling Green Branch Office. The case is being investigated by the Warren County Drug Task Force, and the Federal Bureau of Investigation Louisville Field Office.
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The indictment of a person by a Grand Jury is an accusation only and that person is presumed innocent until and unless proven guilty.
Sacaton Man Sentenced to 7 Years for Habitual Domestic Assault and Possessing Methamphetamine for DistributionRead the Press Release
PHOENIX, Ariz. – Last week, Steven Malcolm Johns, 34, of Sacaton, Arizona, was sentenced by U.S. District Judge Michael T. Liburdi to 5 years in prison for Habitual Domestic Assault and 7 years in prison for Possessing Methamphetamine with Intent to Distribute. The sentences will run concurrently, and be followed by four years of supervised release.
On June 27, 2019, Johns assaulted the mother of his child after previously being convicted of multiple domestic violence offenses. Johns was arrested on August 22, 2019, and found to be in possession of at least 30 grams of methamphetamine. Johns is an enrolled member of the Gila River Indian Community.
The Gila River Police Department conducted the investigation in this case. Raynette Logan, Assistant U.S. Attorney Raynette Logan, District of Arizona, Phoenix, handled the prosecution.
CASE NUMBER: CR-19-00959-PHX-DTL
RELEASE NUMBER: 2020-109_JohnsFor more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Rapid City Woman Sentenced for Conspiracy to Distribute MethamphetamineRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, woman who pleaded guilty to Conspiracy to Distribute a Controlled Substance was sentenced on December 7, 2020, by U.S. District Court Judge Jeffrey L. Viken.
Melanie Vance, age 37, was sentenced to seven years in federal prison, followed by five years of supervised release, and a $100 special assessment to the Federal Crime Victims Fund.
From approximately July 2019 to late December 2019, methamphetamine was brought to South Dakota from Nevada by others. Vance then dispersed the methamphetamine to others for use or distribution.
This case was investigated by the Unified Narcotics Enforcement Team (UNET), Drug Enforcement Agency, the South Dakota Division of Criminal Investigation, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Assistant U.S. Attorney Kathryn N. Rich prosecuted the case.
Vance was immediately returned to the custody of the U.S. Marshals Service.
Rapid City Man Sentenced for Meth TraffickingRead the Press Release
United States Attorney Ron Parsons announced that a Rapid City, South Dakota, man convicted of Conspiracy to Distribute Methamphetamine and two counts of Possession of Methamphetamine with Intent to Distribute was sentenced on December 14, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Daniel Gray Eagle, age 39, was sentenced to 188 months in federal prison, followed by five years of supervised release, and a special assessment to the Federal Crime Victims Fund in the amount of $300.
Gray Eagle was indicted by a federal grand jury on December 10, 2019. He was found guilty after a three-day federal jury trial on September 24, 2020.
The conspiracy conviction stemmed from a plot between January 1, 2017, and February 7, 2020, wherein Gray Eagle knowingly and intentionally conspired with others to distribute and possess with intent to distribute over 500 grams of methamphetamine in South Dakota. Gray Eagle routinely traveled to Rapid City to acquire large amounts of methamphetamine, which he distributed in Eagle Butte, South Dakota.
The first count of Possession of Methamphetamine with Intent to Distribute arose from a high-speed car chase with law enforcement in the southwest corner of the Cheyenne River Sioux Indian Reservation on January 22, 2018. During the chase, Gray Eagle instructed a passenger to throw a pill bottle containing 22 grams of methamphetamine out of the car. The methamphetamine was recovered, and Gray Eagle was taken into custody after crashing the car in a field. The second count arose from a foot pursuit and arrest of Gray Eagle on March 1, 2018, in Eagle Butte. After Gray Eagle was arrested on a tribal warrant, a search of his person revealed three baggies containing a small amount of methamphetamine in his pants pocket as well as a cell phone containing drug-related messages.
This case was investigated by the Northern Plains Safe Trails Drug Enforcement Task Force; the Cheyenne River Sioux Tribe Law Enforcement Services; the Rapid City Police Department; the South Dakota Division of Criminal Investigation; the City of Faith Police Department; the Drug Enforcement Administration; the Bureau of Indian Affairs, Division of Drug Enforcement; and the South Dakota National Guard. Assistant U.S. Attorney Cameron J. Cook prosecuted the case.
Gray Eagle was immediately remanded to the custody of the U.S. Marshals Service.
Randolph County man admits to transporting stolen propertyRead the Press Release
ELKINS, WEST VIRGINIA – Travis Charles White, of Kerens, West Virginia, has admitted to charges related to taking stolen items across state lines, U.S. Attorney Bill Powell announced.
White, 43, pled guilty to one count of “Interstate Transportation of Stolen Property.” White admitted to taking more than $16,000 of stolen U.S. Savings Bonds from West Virginia to Colorado. The crime occurred in February 2017 in Randolph County.
White faces up to 10 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Danae DeMasi-Lemon is prosecuting the case on behalf of the government. The West Virginia State Police investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Princeton Woman Sentenced to 20 Years in Federal Prison for Conspiracy to Distribute Child PornographyRead the Press Release
BLUEFIELD, W.Va. – United States Attorney Mike Stuart announced today that Elizabeth Kaye Haway, 43, of Princeton, was sentenced to the maximum penalty of 20 years in federal prison for conspiracy to distribute child pornography. Upon completion of her prison sentence, the defendant will serve a 25 year term of supervised release. Haway also was ordered to pay $42,900 in restitution to the child victim.
“Twenty years in prison for an abhorrent crime that inflicted lifelong trauma on a young child,” said United States Attorney Mike Stuart. “We will do everything within our power to keep offenders like Haway away from West Virginia’s children. After Haway completes the state prison sentence she is currently serving, she then will spend the next two decades in federal prison.”
Haway previously admitted that she began talking with codefendant Randall Peggs, of Wheeling, on Facebook in November 2018. Over the course of several months, Haway and Peggs conspired to distribute child pornography of Victim 1, a 5-year-old female minor child. The majority of their communications occurred on Facebook Messenger and conversations focused on Haway’s desires to touch and sexually violate Victim 1 while recording it to send to Peggs. Peggs encouraged Haway to record and send him nude videos of Victim 1 and told her that he would watch anything she sent him. Ultimately, Haway recorded a video of child pornography depicting a nude Victim 1 and sent the video to Peggs twice via Facebook in February 2019.
Haway currently is serving a lengthy state prison sentence for first degree sexual assault, sexual abuse and incest involving the same minor female child. Peggs previously pled guilty on August 3, 2020 to a federal child pornography charge arising out of this incident. His sentencing is scheduled for January 11, 2021.
This case was investigated by the Mercer County Sheriff’s Department, the Federal Bureau of Investigation (FBI) and the FBI’s Violent Crimes Against Children Task Force. Senior United States District Judge David A. Faber imposed the sentence. Assistant United States Attorney Kristin F. Scott handled handling the prosecution.
This case is being prosecuted as part of Project Safe Childhood, a nationwide initiative of the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorney’s Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute those who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 1:19-cr-00304.
Follow us on Twitter: SDWVNews and USAttyStuart
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Pittsburgh Woman Sentenced for Role in DS44 Gang’s Drug TraffickingRead the Press Release
PITTSBURGH, PA - A resident of Pittsburgh, PA, has been sentenced in federal court to time served and three years’ supervised release on her conviction of narcotics trafficking in connection with a large-scale investigation, United States Attorney Scott W. Brady announced today.
United States District Judge William S. Stickman imposed the sentence on Theresa Somerville, 50.
In connection with Somerville’s earlier guilty plea, the court was advised that in 2017, the Greater Pittsburgh Safe Streets Task Force initiated an investigation primarily targeting the Darccide/Smash 44, or DS44, neighborhood gang, and its drug-trafficking activity, in and around the South Side area of Pittsburgh. As part of this large-scale narcotics and firearms investigation, in February of 2019, the United States received authorization to conduct a federal wire investigation, which continued through June of 2019. In addition to communications about drug trafficking between Christopher Highsmith, the leader of the organization, and many of his coconspirators, agents made numerous seizures of fentanyl, heroin, and other drugs from members of the organization, as well as maintained critical physical surveillance of Highsmith’s drug-trafficking activities.
Somerville was convicted of one count of conspiracy to distribute and possess with intent to distribute heroin and fentanyl. She was one of 38 individuals charged in the offense, including Highsmith, as well as her son, Ronald Williams, and her daughter, Ronika Somerville. Somerville admitted to personally packaging and distributing quantities of fentanyl and heroin mixtures at her son’s direction, as well as acknowledged that she separately distributed cocaine and crack cocaine. Somerville had served approximately one month in prison pending her entry of a guilty plea in this case.
Prior to imposing sentence, Judge Stickman stated that given the defendant’s lack of criminal history, her willingness to accept responsibility for her conduct, and her poor health, a sentence that did not include an additional term of imprisonment was appropriate.
Assistant United States Attorney Carolyn J. Bloch prosecuted this case on behalf of the government.
United States Attorney Brady commended the Federal Bureau of Investigation for leading the multi-agency investigation of this case, which included the Bureau of Alcohol Tobacco Firearms and Explosives, Allegheny County Adult Probation, Allegheny County Police Department, Allegheny County Sheriff’s Office, Pennsylvania Attorney General’s Office Bureau of Narcotics, Pittsburgh Bureau of Police, and the Wilkinsburg Police Department for the investigation leading to the successful prosecution of Somerville.
Pine Ridge Woman Charged with Twenty FeloniesRead the Press Release
United States Attorney Ron Parsons announced that a Pine Ridge South Dakota, woman has been indicted by a federal grand jury for seven counts of Assault Resulting in Serious Bodily Injury, seven counts of Assault with a Dangerous Weapon, four counts of Maiming, one count of Health Care Fraud, and one count of Obtaining Controlled Substances by Fraud.
Frenchone One Horn, a/k/a Frenchone Kills In Water, age 40, appeared before U.S. Magistrate Judge Daneta Wollmann on December 2, 2020, and pleaded not guilty to the Indictment.
The maximum penalty upon conviction is 10 years in prison, and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund for each of the Assault Resulting in Serious Bodily Injury, Assault with a Dangerous Weapon and Maiming charges. The maximum penalty upon conviction for the Health Care Fraud charge is 5 years in prison, and/or a $250,000 fine, 3 years of supervised release, and $100 to the Federal Crime Victims Fund. The maximum penalty upon conviction for the Obtaining Controlled Substances by Fraud charge is 4 years in prison, and/or a $250,000 fine, 1 year of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The charges relate to One Horn assaulting five individuals with rocks in 2018 and 2019 at Pine Ridge for the purpose of committing health care fraud. These assaults resulted in serious bodily injury and required three of the victims to suffer finger amputations. One Horn also committed health care fraud by giving fraudulent information concerning the intentional assaults in order to obtain services and controlled substances, namely Hydrocodone.
The charges are merely accusations and One Horn is presumed innocent until and unless proven guilty.
The investigation is being conducted by the US Department of Health and Human Services - Office of Inspector General, the Federal Bureau of Investigation, and Oglala Sioux Tribe Department of Public Safety. Assistant U.S. Attorney Megan Poppen is prosecuting the case.
One Horn was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has been set for February 9, 2021.
Pierre Woman Sentenced for Meth TraffickingRead the Press Release
United States Attorney Ron Parsons announced that a Pierre, South Dakota, woman convicted of Conspiracy to Distribute Methamphetamine was sentenced on December 14, 2020, by Chief Judge Roberto A. Lange, U.S. District Court.
Tiffany Kay Frazier, n/k/a Tiffany Kay Castiglione, age 27, was sentenced to 60 months in federal prison, followed by four years of supervised release, a $1,000 fine, and a special assessment to the Federal Crime Victims Fund in the amount of $100.
Castiglione was indicted by a federal grand jury on September 10, 2019. She pled guilty on September 28, 2020.
The conviction stemmed from a conspiracy beginning in at least January 2017, continuing to September 10, 2019, wherein Frazier was involved with several others to distribute between 50 and 200 grams of methamphetamine in and around the Gettysburg and Pierre and Ft. Pierre communities in South Dakota.
This case was investigated by the Pierre Police Department, the Mobridge Police Department, and the Northern Plains Safe Trails Drug Enforcement Task Force. Assistant U.S. Attorney Meghan N. Dilges prosecuted the case.
Frazier will self-report to the custody of the U.S. Marshals Service on January 5, 2021.
Peter D. Leary Named Acting U.S. Attorney for the Middle DistrictRead the Press Release
MACON, Ga. – Peter D. Leary has been named as the Acting U.S. Attorney for the Middle District of Georgia. Acting U.S. Attorney Leary previously served as the First Assistant U.S. Attorney since 2018.
Acting U.S. Attorney Leary has served the citizens of the Middle District of Georgia as a prosecutor since 2012. Since joining the United States Attorney’s Office (USAO), he has worked as the office’s Anti-Terrorism Advisory Council (ATAC) coordinator, its Computer Hacking and Intellectual Property (CHIP) prosecutor and as the First Assistant U.S. Attorney. In 2019, he received the Anti-Defamation League’s SHIELD award with FBI and Department of Justice partners, and he shared the 2018 International Association of Chiefs of Police/Thomson Reuters Award for Excellence in Criminal Investigation with the FBI and GBI.
“It is a tremendous honor to serve the citizens of the Middle District of Georgia in this new role,” said Acting U.S. Attorney Leary. “I pledge to continue the great legacy of this office by working closely with our law enforcement partners to ensure that justice is served with integrity and a steadfast dedication to upholding the rule of law.”
As Acting U.S. Attorney, Mr. Leary is the top-ranking federal law enforcement official in the Middle District of Georgia, which covers 70 of Georgia’s 159 counties, includes Albany, Athens, Columbus, Macon and Valdosta, and has a population of approximately 2,045,000 people. The office is responsible for prosecuting federal crimes in the district, including crimes related to terrorism, public corruption, child exploitation, fraud, firearms, illegal gangs and narcotics. The office also defends the United States in civil cases and collects debts owed to the United States.
Raised in Watkinsville, Georgia, Mr. Leary received his B.A. and J.D. from University of Virginia, where he was a Jefferson Scholar. After law school, Mr. Leary clerked for U.S. District Judge Hugh Lawson of the U.S. District Court for the Middle District of Georgia. Following his clerkship, Mr. Leary joined the Federal Programs Branch of the DOJ through its Honors Program, where he worked extensively with the Intelligence Community. In addition to his work at the United States Attorney’s Office, Mr. Leary serves as adjunct faculty at Mercer University, teaching Criminal Justice.
Questions can be directed to Pamela Lightsey, Public Information Officer, United States Attorney’s Office, at (478) 621-2603 or Melissa Hodges, Public Affairs Director (Contractor), United States Attorney’s Office, at (478) 765-2362.
Paterson Associate of 230 Boys Gang Indicted for Drug Conspiracy and Possession and Distribution of Heroin and FentanylRead the Press Release
NEWARK, N.J. – A Passaic County, New Jersey, man was indicted by a grand jury today for his role in a conspiracy to distributed illegal drugs in Paterson, U.S. Attorney Craig Carpenito announced.
Dashion Kelson, 40, a/k/a “Tank,” a/k/a “Izzy,” a/k/a “Stizzy, of Paterson, New Jersey, was indicted on charges of conspiring to distribute and possess with the intent to distribute 100 grams or more of heroin, and 40 grams or more of fentanyl, five counts of distribution of controlled substances, and two counts of possession with the intent to distribute heroin. Kelson and 16 other members and associates of the 230 Boys were charged by complaint in October 2019.
According to the documents filed in this case and statements made in court:
Kelson and his conspirators are members and associates of the 230 Boys street gang, which operates primarily in and around Rosa Parks Boulevard and Godwin Avenue in Paterson. Through investigative techniques, including numerous controlled purchases of narcotics, consensually recorded telephone calls and text messages, physical surveillance, and the analysis of telephone call detail records, law enforcement determined that from September 2018 through Oct. 3, 2019, Kelson and others conspired to distribute narcotics, to include heroin and fentanyl. On six occasions, he distributed controlled substances, to include heroin and fentanyl. On Oct. 3, 2019, Kelson possessed with the intent to distribute two separate quantities of heroin.
Six co-defendants have since pleaded guilty before U.S. District Judge Brian R. Martinotti: Keith Brinkley, 30; Isaiah Hargrove, 21; Tyson Jacobs, 21; Amir Jones, 21; Dwayne Northern, 35; and Cequan Wharton, 30, all of Paterson. Six other co-defendants have been charged by a second superseding indictment: Wyzier Peterson, 23; Carl Brown, 26; Aaryn Abrams, 24; Najier Boone, 24; Zikeme Brooks, 27; and Jimir Ricks, 26.
Counts 1 and 8 of today’s indictment carry a mandatory minimum sentence of five years in prison, a maximum penalty of 40 years in prison, and a mandatory fine of $5 million. Counts 2 through 7 and 9 carry a maximum penalty of 20 years in prison, and a maximum fine of $1 million.
This case is being conducted under the auspices of the Organized Crime Drug Enforcement Task Force (OCDETF). The principal mission of the OCDETF program is to identify, disrupt and dismantle the most serious drug trafficking, weapons trafficking and money laundering organizations, and those primarily responsible for the nation’s illegal drug supply.
U.S. Attorney Carpenito credited special agents and task force officers with the Bureau of Alcohol, Tobacco, Firearms and Explosives, Newark Division, under the direction of Special Agent in Charge Charlie J. Patterson; special agents of the Drug Enforcement Administration, under the direction of Special Agent in Charge Susan A. Gibson in Newark; officers of the N.J. State Police, under the direction of Col. Patrick J. Callahan; officers of the Paterson Police Department, under the direction of Director Jerry Speziale and Police Chief Ibrahim Baycora; detectives of the Passaic County Prosecutor’s Office, under the direction of Prosecutor Camelia Valdes; and the Passaic County Sheriff’s Office, under the direction of Sheriff Richard H. Berdnik, with the investigation leading to the charges. He also thanked the U.S. Marshals Service, the Bergen County Sheriff's Office and the Belleville and Livingston police departments for their assistance with the case.
The government is represented by Assistant U.S. Attorney Francesca Liquori of the U.S. Attorney’s Office’s Organized Crime and Gangs Unit in Newark.
The charges and allegations against Kelson and the remaining co-defendants in the complaint and second superseding indictment are merely accusations, and they are presumed innocent unless and until proven guilty.
New York Man Pleads Guilty to Possessing Cocaine Base and Fentanyl with Intent to DistributeRead the Press Release
BANGOR, Maine: A New York man pleaded guilty Friday in federal court to possessing cocaine base and fentanyl with intent to distribute, U.S. Attorney Halsey B. Frank announced.
According to court records, on November 15, 2019, law enforcement officers encountered Terrence Robinson, aka “Trevor Scott,” 27, in Bangor. Robinson had active warrants for his arrest. Officers searched Robinson and located packages of drugs concealed in his pants. Officers seized a package containing 66.9 grams of a mixture containing cocaine base and a package containing 68.9 grams of a mixture containing fentanyl, heroin and methamphetamine.
Robinson faces between five and 40 years in prison and a fine of up to $5 million. He also faces between four years and a lifetime of supervised release. He will be sentenced after the completion of a presentence investigation report by the U.S. Probation Office.
The U.S. Drug Enforcement Administration, the Maine State Police and the Bangor Police Department investigated the case.
New Haven-Area Drug Dealer with Long Criminal History Sentenced to More Than 10 Years in PrisonRead the Press Release
John H. Durham, United States Attorney for the District of Connecticut, announced that FRANK CARR, also known as “FL,” 53, of Hamden, was sentenced today by U.S. District Judge Robert N. Chatigny to 126 months of imprisonment, followed by eight years of supervised release, for distributing narcotics, and for violating the conditions of his supervised release that followed a prior federal narcotics conviction.
Pursuant to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), the sentencing occurred via videoconference.
According to court documents and statements made in court, this matter stems from an investigation headed by the FBI’s New Haven Safe Streets/Gang Task Force and New Haven Police Department that targeted drug trafficking and related acts of violence by members, former members and associates of the “Island Brothers” street gang in New Haven. The investigation, which included court-authorized wiretaps and controlled purchases of narcotics, also revealed that the drug trafficking organization had established a base of operation in Fitchburg, Massachusetts. The investigation subsequently identified a second drug trafficking network that involved the large-scale distribution of heroin.
Investigators developed information that, in March 2019, while Carr was on federal supervised release, he provided a kilogram of cocaine to the leader of one of the drug trafficking networks. In May and June 2019, investigators made multiple controlled purchases of cocaine and crack from Carr, including a purchase of approximately 78 grams of crack from Carr in exchange for $3,000 on May 23, 2019.
On July 9, 2019, a grand jury in New Haven returned a 15-count indictment charging Carr and 24 other individuals with federal narcotics offenses related to the distribution of crack cocaine, cocaine and heroin. Two defendants were added in a superseding indictment that was returned on November 25, 2019. In a subsequent superseding indictment, Carr was charged with attempted obstruction of justice for allegedly asking a potential witness in this case to provide false exculpatory information about Carr.
Carr has been detained since his arrest on July 10, 2019. On October 28, 2020, he pleaded guilty to one count of possession with intent to distribute, and distribution of, 28 grams or more of cocaine base (“crack”).
This is Carr’s third federal conviction in the District of Connecticut. In December 1996, he was sentenced to 60 months of imprisonment for possession of a firearm by a convicted felon. In January 2013, he was sentenced to 63 months of imprisonment for distributing heroin. Carr’s criminal history also includes state convictions for manslaughter with a firearm, weapons possession and drug offenses.
Judge Chatigny sentenced Carr to 120 months of imprisonment for distributing crack, and 24 months of imprisonment for violating the conditions of his supervised release. Six months of the 24-month supervised release sentence were imposed consecutively with the 120-month sentence in the underlying case.
This matter is being investigated by the FBI’s New Haven Safe Streets/Gang Task Force, New Haven Police Department, Milford Police Department, Hamden Police Department, East Haven Police Department, Connecticut State Police, Connecticut Department of Correction and the U.S. Drug Enforcement Administration.
This case is being prosecuted by Assistant U.S. Attorneys Anthony E. Kaplan, Peter D. Markle, Elena L. Coronado and Tara E. Levens through the Organized Crime Drug Enforcement Task Forces (OCDETF) Program. OCDETF identifies, disrupts and dismantles drug traffickers, money launderers, gangs and transnational criminal organizations through a prosecutor-led and intelligence-driven approach that leverages the strengths of federal, state and local law enforcement agencies. Additional information about the OCDETF Program can be found at https://www.justice.gov/OCDETF.
Nebraska City Man Sentenced for Child PornographyRead the Press Release
United States Attorney Joe Kelly announced that James S. Brink, 30, of Nebraska City, Nebraska, was sentenced in federal court in Omaha on December 11, 2020 for possessing child pornography. United States District Judge Robert F. Rossiter, Jr. sentenced Brink to a 63-month term of imprisonment. There is no parole in the federal system. After his release from prison, Brink will begin a five-year term of supervised release and will be required to register as a sex offender.
On July 2, 2019, investigators with the Nebraska State Patrol went to Brink’s home after receiving a tip that someone inside that residence was using a computer to view child pornography. Brink consented to a search of his cell phone. Investigators seized the phone upon viewing images of child pornography. Later analysis revealed more than 650 images of child pornography including images of prepubescent minors engaged in acts of bondage and using sex toys.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the Internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Nebraska State Patrol.
Morgan County man admits to child pornography chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Gunner Scott Young, of Berkeley Springs, West Virginia, has admitted to a child pornography charge, U.S. Attorney Bill Powell announced.
Young, age 28, pled guilty to one count of “Possession of Child Pornography.” Young admitted to having pornographic images involving minors under the age of 12 in June 2019 in Morgan County.
Young faces up to 20 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Kimberley D. Crockett is prosecuting the case on behalf of the government. The West Virginia State Police investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Monmouth County Man Sentenced to 13 Months in Prison for Role in Multi-State Patient Brokering and Bribery SchemeRead the Press Release
TRENTON, N.J. – A Monmouth County, New Jersey, man was sentenced today to 13 months in prison for participating in a conspiracy to defraud health insurance companies through a multi-state patient brokering scheme in which he bribed drug-addicted individuals to enroll in drug rehabilitation in exchange for referral fees from the rehabilitation centers, U.S. Attorney Craig Carpenito announced.
Peter J. Costas, 27, of Red Bank, New Jersey, previously pleaded guilty by teleconference before U.S. District Judge Peter G. Sheridan to an information charging him with one count of conspiracy to commit health care fraud. Judge Sheridan imposed the sentence by videoconference today.
According to documents filed in the case and statements made in court:
Costas helped orchestrate a scheme in New Jersey, California, and other states that involved bribing individuals addicted to heroin and other drugs to enter into drug rehabilitation centers so Costas and his conspirators could generate referral fees from those facilities.
Costas worked with several marketing companies to carry out the scheme, but one marketing company in California run by Costas’s conspirators was pivotal. The marketing company maintained contractual relationships with drug treatment facilities around the country. Costas was engaged by the marketing company to recruit potential patients, who were addicted to heroin or other drugs and who had robust private health insurance, from New Jersey and other states.
To convince drug-addicted individuals to travel to and enroll in rehabilitation when they otherwise would not have, Costas offered to bribe them – often as much as several thousand dollars. Once they agreed to enroll in drug rehabilitation in exchange for the offered bribe, Costas and the owners of the marketing company would arrange and pay for cross-country travel to the drug treatment centers in California and other states. Costas would stay in touch with the New Jersey patients at the facilities and specifically instruct them to stay at the facilities long enough to generate referral payments.
Costas and the marketing company often directed patients to different rehabilitation facilities month after month to generate multiple referral payments without regard to whether the substance abuse treatment was medically necessary or effective. In a conversation over Facebook, one patient told Costas that if Costas made good on his promise to pay the patient a bribe, the patient would enroll in additional facilities to trigger additional referral payments and bribes: “[J]ust get us [sic] grab the dough and put us in another place. . . . Get paid some more feel me. . . . I’ll keep this up all year wit[h] you. As long as you do us right.” When the patient later expressed doubt that Costas would pay the bribe, Costas responded, “Don’t worry. . . . I do this with SO MANY PPL [people].”
Costas and the marketing company sent patients to facilities in California and other states that they knew provided ineffective drug treatment or actually fostered drug use on their premises. The facilities typically paid the marketing company a fee of $5,000 to $10,000 per patient referral, and Costas and other brokers received approximately half that amount for each patient they brokered. During the scheme, Costas brokered dozens of patients on behalf of marketing companies around the country, and the conspiracy caused millions of dollars of losses for health insurers.
In addition to the prison term, Judge Sheridan sentenced Costas to three years of supervised release and ordered him to pay restitution of $502,208.
U.S. Attorney Carpenito credited special agents of the FBI, under the direction of Special Agent in Charge George M. Crouch in Newark, with the investigation leading to today’s sentencing.
The government is represented by Assistant U.S. Attorney Jason S. Gould of the Health Care Fraud Unit in Newark.
Millions in Assets of Encrypted Telecommunications Criminal Enterprise Seized in Singapore and Repatriated to the United StatesRead the Press Release
Assistant U.S. Attorneys Joshua Mellor (619) 546-9733 and Mark W. Pletcher (619) 546-9714
NEWS RELEASE SUMMARY – December 14, 2020
SAN DIEGO – Four bank accounts containing $3,971,468.40 in illicit funds generated from Phantom Secure, an encrypted telecommunications network used by transnational organized criminal syndicates, were seized by authorities in Singapore and repatriated to the United States, the U.S. Attorney’s Office for the Southern District of California announced today.
Vincent Ramos, the chief executive of Canada-based Phantom Secure, and four of his associates were indicted by a federal grand jury in March 2018 on charges that they operated a criminal enterprise that facilitated the transnational importation and distribution of narcotics through the sale and service of encrypted telecommunications devices and services.
This was the first time the U.S. government targeted a company and its principals for conspiring with criminal organizations by providing them with the technological tools to evade law enforcement and obstruct justice while committing transnational drug trafficking.
According to court documents, Phantom Secure advertised its products as impervious to decryption, wiretapping or legal third-party records requests. Phantom Secure also guaranteed the destruction of evidence contained within a device if it was compromised, either by an informant or because it fell into the hands of law enforcement.
Starting in 2018, U.S. authorities, working closely with the Commercial Affairs Department (CAD) of the Singapore Police Force, identified and seized over $3.9 million in illicit funds linked to the sale of Phantom Secure devices. Those funds were seized in Singapore, forfeited as proceeds of criminal activity and have now been repatriated to the United States.
In October 2018, Ramos pleaded guilty to leading a criminal enterprise that facilitated the transnational importation and distribution of narcotics through the sale and service of encrypted communications devices. In his plea agreement, Ramos admitted that he and his co-conspirators facilitated the distribution of cocaine, heroin, and methamphetamine to locations around the world including in Australia, Canada, Europe, Mexico, Thailand and the United States by supplying narcotics traffickers with Phantom Secure encrypted communications devices designed to thwart law enforcement.
To keep the communications out of the reach of law enforcement, Ramos and others maintained Phantom Secure servers in Panama and Hong Kong, used virtual proxy servers to disguise the physical location of its servers, and remotely deleted or “wiped” devices seized by law enforcement. Ramos’ customers used his products to devastating and sometimes deadly effect, and Ramos used this to market his encryption services to criminals across the world. According to court documents, in response to a March 5, 2014 news article that reported investigations of a gangland murder were stymied because the suspects used Phantom Secure devices to coordinate the killing, Ramos wrote, “This is the best verification on what we have been saying all along – proven and effective for now over nine years. It is the highest level of authority confirming our effectiveness. It can’t get better than that.”
As part of his guilty plea, Ramos agreed to an $80 million forfeiture money judgment as well as the forfeiture of tens of millions of dollars in identified assets, ranging from bank accounts worldwide, to houses, to a Lamborghini, to cryptocurrency accounts, to gold coins. The money repatriated from Singapore was among the assets identified by investigators to be forfeited. Ramos was sentenced to 108 months in prison.
“Tremendous determination by this office and our investigative partners dismantled this criminal network,” said U.S. Attorney Robert Brewer. “As a result of this ground-breaking prosecution, the network has been shut down, its founder has been brought to justice, and its money is being identified and forfeited to help victims and witnesses of crime.” Brewer praised prosecutors Mark Pletcher and Joshua Mellor as well as agents from the Federal Bureau of Investigation, U.S. Drug Enforcement Administration, and U.S. Marshals Service for their excellent work on this case.
The Department of Justice specifically commends the efforts of our Singapore counterparts in identifying, freezing, and repatriating proceeds of this criminal enterprise. Investigators with the Commercial Affairs Department and representatives of the Attorney General’s Chamber worked relentlessly to ensure that these proceeds would not be used to promote further illegal activity.
The U.S. Attorney’s Office for the Southern District of California further notes the invaluable assistance of the Department of Justice’s Office of International Affairs.
“The repatriation of close to $4 million by our Singapore-based partners ensures that Vincent Ramos and the leaders of Phantom Secure will pay for their crimes,” stated FBI Special Agent in Charge Suzanne Turner. “The FBI’s unrelenting work to take down transnational criminal organizations like Phantom Secure and recoup their illegal financial gains is only possible through close working relationships with our global law enforcement partners.”
“This case demonstrates the U.S. Marshals’ firm commitment to tracing illicit funds and dismantling criminal enterprises worldwide,” said Assistant Director Timothy Virtue of the U.S. Marshals Asset Forfeiture Division. “We express our gratitude to our Singapore counterparts for their unflinching cooperation in clamping down on transnational organized criminal syndicates and money launderers.”
This prosecution is part of an Organized Crime Drug Enforcement Task Forces (OCDETF) investigation. OCDETF identifies, disrupts, and dismantles the highest-level drug traffickers, money launderers, gangs, and transnational criminal organizations that threaten the United States by using a prosecutor-led, intelligence-driven, multi-agency approach that leverages the strengths of federal, state, and local law enforcement agencies against criminal networks.
AGENCIES
Federal Bureau of Investigation
Drug Enforcement Administration
U.S. Marshals Service
Singapore Police Force - Commercial Affairs Department
Singapore Attorney-General’s Chambers
Australian Federal Police
New South Wales Police (Australia)
New South Wales Crime Commission (Australia)
Australian Criminal Intelligence Commission
Royal Canadian Mounted Police
International Assistance Group, Department of Justice, Canada Department of Justice, Organized Crime Drug Enforcement Task Forces
Office of Enforcement Operations of the Department’s Criminal Division
Department of Justice’s Office of International Affairs
Michigan Man Sentenced for His Role in Scheme That Defrauded Victims Out of Millions of DollarsRead the Press Release
CONTACT: Barbara Burns
PHONE: (716) 843-5817
FAX #: (716) 551-3051BUFFALO, N.Y. -- U.S. Attorney James P. Kennedy, Jr. announced today that Leonard Smith, 56, of Clawson, Michigan, who was convicted of conspiracy to commit wire fraud, was sentenced to serve 30 months in prison by U.S. District Judge Richard J. Arcara.
Assistant U.S. Attorney Douglas A. Penrose, who handled the case, stated that between May 2010 and July 2015, the defendant conspired with others fraudulently to obtain money and property from investors. As part of the scheme, Smith, who was a financial advisor, solicited investments from his clients at two companies—i2i Capital LLC and i2i Settlement Partners LLC. The companies, which were formed by co-conspirators Christopher Dillon and Gilbert Lynagh, were incorporated in Delaware but listed a business address in Lancaster, NY.
Smith, Dillon, Lynagh, and other members of the conspiracy, caused 27 victims to invest over $5,000,000 in i2i Capital and/or i2i Settlement Partners. False and fraudulent representations were made to victims regarding the nature of the investment and the associated risks, duration, and rates of return. Smith also misrepresented his compensation regarding the victims’ investments in the companies. The majority of victim funds were utilized by Smith, Dillon, Lynagh, and other members of the conspiracy in a manner that was not authorized by the victims, including for personal use. None of the victims received the promised return on their investments, and none saw the return of their original investment funds as promised by Smith, Dillon, and Lynagh.
Gilbert Lynagh and Christopher Dillon were previously convicted for their roles in the conspiracy.
The sentencing is the result of an investigation by the Federal Bureau of Investigation, Buffalo Office, under the direction of Special Agent-in-Charge Stephen Belongia.
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Michigan Man Ordered Detained Pending Child Sexual Exploitation ChargesRead the Press Release
Jacksonville, Florida – United States Attorney Maria Chapa Lopez announces the return of an indictment charging Arthur Jay Traxler, Jr. (55, Michigan) with one count of attempted online enticement of a minor to engage in sexual activity and one count of attempted production of child sexual exploitation materials. If convicted, Traxler faces a minimum mandatory term of 25 years, and up to life, in federal prison. Traxler was arrested on November 9, 2020, in Monroe, Michigan and was ordered detained pending trial.
According to the indictment, between July 21 and August 4, 2020, Traxler attempted to entice an individual, whom he believed was under the age of 18, to engage in sexual activity. Traxler also attempted to entice a minor to engage to produce child exploitation materials during this same time period.
An indictment is merely a formal charge that a defendant has committed one or more violations of federal criminal law, and every defendant is presumed innocent unless, and until, proven guilty.
This case was investigated by the Federal Bureau of Investigation. It is being prosecuted by Assistant United States Attorney Ashley Washington.
It is another case brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys’ Offices and the Criminal Division’s Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
Merrimack Man Pleads Guilty to Fentanyl TraffickingRead the Press Release
CONCORD - Nicholas Snow, 26, of Merrimack, pleaded guilty in federal court to possession of fentanyl with intent to distribute, United States Attorney Scott W. Murray announced today.
According to court documents and statements made in court, on February 1, 2020, Hudson patrol officers stopped a car in which Snow was a passenger. Both the driver and Snow had suspended licenses. An officer later determined that Snow was in possession of a pouch containing fentanyl, a scale, packaging materials, and $655 in cash. In his post-arrest interview, Snow admitted to drug distribution activities in Hudson. Snow’s cell phone also revealed communications about drug deals.
Snow is scheduled to be sentenced on March 22, 2021.
“In order to protect public health and safety, we are working closely with our law enforcement partners to identify and prosecute fentanyl traffickers,” said U.S. Attorney Murray. “We will not hesitate to pursue federal prosecutions of the fentanyl dealers who are endangering our communities by selling this deadly substance.”
This matter was investigated by the Hudson Police Department. The case is being prosecuted by Assistant U.S. Attorney Joachim H. Barth.
This case is part of Operation Synthetic Opioid Surge (S.O.S.). In July of 2018, Attorney General Jeff Sessions announced the creation of S.O.S., which is being implemented in the District of New Hampshire and nine other federal districts. The goal of S.O.S. is to combat the large number of overdoses and deaths associated with fentanyl and other synthetic opioids. In New Hampshire, the U.S. Attorney’s Office is focusing its efforts on prosecuting synthetic opioid trafficking cases arising in Hillsborough County, which includes Manchester and Nashua.
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Medical Device Manufacturer's Director of Clinical Services Pleads Guilty to Causing the Adulteration of Rectal Pressure SensorsRead the Press Release
Clinical Director for The Prometheus Group Pleads Guilty for Role in Causing the Reuse of Single-User Rectal Pressure Sensors on Multiple Patients
GRAND RAPIDS, MICHIGAN — U.S. Attorney Andrew B. Birge announced today that Denise D’Andrea pleaded guilty to one count of causing the adulteration of a medical device. In the criminal information, the government alleged that Ms. D’Andrea, the Director of Clinical Services at The Prometheus Group ("Prometheus"), a device manufacturer headquartered in Dover, New Hampshire, trained medical practitioners in the Western District of Michigan to reuse a single-user rectal pressure sensor on multiple patients by covering it with a surgical glove between uses. The rectal pressure sensor is a component part of Prometheus’s Pathway CTS 2000 Pelvic Floor Training System used in a form of therapy known as pelvic muscle rehabilitation. FDA cleared this system for introduction into the market in 2000, but restricted use of the rectal pressure sensor to single-patient use only. As part of that clearance, FDA also approved instructions for use submitted by Prometheus for the rectal pressure sensor that prominently stated: "This sensor is restricted for single person use only. Use by another person is strictly prohibited by Federal Regulations."
The government charged Ms. D’Andrea under the criminal provisions of the Federal Food, Drug & Cosmetic Act ("FDCA"), alleging that Ms. D’Andrea caused medical practitioners to engage in conduct that resulted in the rectal pressure sensors being adulterated. Under the FDCA, a device is adulterated if it was "prepared, packed, or held under insanitary conditions whereby it may have been contaminated with filth, or whereby it may have been rendered injurious to health." As part of her guilty plea, Ms. D’Andrea acknowledged the government’s evidence that reusing the rectal pressure sensor on multiple patients, even when covered with a glove, resulted in the adulteration of the device given the risk of cross-contamination of viral and bacterial diseases. She faces up to a year in prison.
Ms. D’Andrea’s guilty plea follows the May 2020 convictions of Dr. Roger Beyer and Susan Wright who, in addition to convictions related to healthcare fraud, both pleaded guilty to counts of adulteration involving the reuse of the Prometheus rectal pressure sensor on multiple patients at Dr. Beyer’s practices. On October 29, 2020, U.S. District Judge Janet T. Neff sentenced Dr. Beyer to 57 months of incarceration, and she previously sentenced Ms. Wright to three years of probation and over 3,000 hours of community service. Dr. Beyer and Ms. Wright, along with an office manager, paid separate civil settlements under the Federal False Claims Act totaling over $1.25 million.
"The Federal Food, Drug & Cosmetic Act plays an important role in protecting the public health and safety," stated U.S. Attorney Birge. "When device manufacturer representatives and medical practitioners flaunt the rules, they jeopardize the wellbeing of patients in our community. My office is committed to working with FDA and other law enforcement to hold any other responsible parties accountable for this or other similar misconduct."
"The FDA requires medical device manufacturers to provide healthcare professionals with the important safety information, including single-use and single-user designations, that is required to protect patients’ health. When manufacturers and their representatives blatantly disregard this safety information, they put patients’ health at risk," said Special Agent in Charge Lynda M. Burdelik, FDA Office of Criminal Investigations Chicago Field Office. "We will continue to aggressively investigate and bring to justice those who threaten the health and safety of Americans."
This case was the result of an investigation by FDA’s Office of Criminal Investigations, the U.S. Department of Health and Human Services, Office of Inspector General, and the Federal Bureau of Investigation, in coordination with the U.S. Attorney’s Office for the Western District of Michigan. Assistant U.S. Attorney Raymond E. Beckering III and Trial Attorney Ross S. Goldstein of the Justice Department’s Consumer Protection Branch are prosecuting the criminal case against Ms. D’Andrea, with subject-matter expertise and assistance from FDA’s Office of Chief Counsel and Assistant U.S. Attorney Andrew J. Hull.
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Marion County man admits to firearms chargeRead the Press Release
CLARKSBURG, WEST VIRGINIA – Shawn Monte Pritchard, of Fairmont, West Virginia, has admitted to a firearms charge, U.S. Attorney Bill Powell announced.
Pritchard, 33, pled guilty to one count of “Unlawful Possession of a Firearm.” Pritchard, a person prohibited from having a firearm because of prior felony convictions, admitted to having a 12-gauge shotgun in May 2020 in Marion County.
Pritchard faces up to 10 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Sarah E. Wagner is prosecuting the case on behalf of the government. The Bureau of Alcohol, Tobacco, Firearms and Explosives and the West Virginia State Police investigated.
U.S. Magistrate Judge Michael John Aloi presided.
Man Sentenced for Producing Images of Child Sexual AbuseRead the Press Release
NORFOLK, Va. – A Keswick man was sentenced today to 22 years in prison for his role in producing images of child sexual abuse and attempting to meet a minor for sex.
According to court documents, in 2019, Bryan Wesley Petitt, 33, engaged in sexually explicit communications with an undercover agent he believed to be a 14-year-old minor. Petitt drove from Charlottesville to military housing in Norfolk in order to engage in sex with the girl. Upon his arrest, law enforcement officers discovered images of child sexual abuse on his phone. Investigators later learned that Petitt produced one of the images.
This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by U.S. Attorney’s Offices and the Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state, and local resources to better locate, apprehend, and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.justice.gov/psc.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Gregory Scovel, Special Agent in Charge of the Naval Criminal Investigative Service (NCIS) Norfolk Field Office; Raymond Villanueva, Special Agent in Charge of U.S. Immigration and Customs Enforcement’s (ICE) Homeland Security Investigations (HSI) Washington, D.C.; and Larry D. Boone, Chief of Norfolk Police, made the announcement after sentencing by U.S. District Judge John A. Gibney, Jr.
Special Assistant U.S. Attorney Matthew Heck prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:20-cr-16.
Man Charged with Bank FraudRead the Press Release
NEW ORLEANS, LOUISIANA – JOSHUA HOCKLESS, age 29, a resident of Belle Chasse, was charged on December 11, 2020 with one count of bank fraud in violation of Title 18, United States Code, Section 1344, announced U.S. Attorney Peter G. Strasser. If convicted, HOCKLESS faces maximum penalties of 30 years imprisonment, a $1,000,000 fine, 5 years of supervised release, and a $100 special assessment.
According to the bill of information, between October 2013 and July 2014, HOCKLESS executed a scheme to fraudulently obtain approximately $87,489.34 from USAA Bank by taking advantage of USAA’s policy of honoring checks and cash transfers of enlisted personnel before the funds cleared the issuing bank. To that end, HOCKLESS opened, and caused to be opened, accounts at third-party banks. HOCKLESS used these accounts to make online transfers of cash to USAA even though the third-party bank accounts contained insufficient funds to cover the transfers. HOCKLESS then withdrew or caused these funds to be withdrawn from USAA before the fund transfers cleared the issuing bank.
U.S. Attorney Strasser reiterated that the bill of information is merely a charge and that the guilt of the defendant must be proven beyond a reasonable doubt.
U.S. Attorney Strasser praised the work of the Army Criminal Investigations Command. The prosecution of this case is being handled by Assistant U. S. Attorney G. Dall Kammer, Supervisor of the General Crimes Unit.
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Justice Department Requires Divestiture of Tufts Health Freedom Plan in Order for Harvard Pilgrim and Health Plan Holdings to Proceed with MergerRead the Press Release
The Department of Justice announced today that it would require Harvard Pilgrim Health Care (Harvard Pilgrim) and Health Plan Holdings (fka Tufts Health Plan) to divest Tufts Health Freedom Plan Inc. (Tufts Freedom), in order to proceed with their merger. Tufts Freedom is Health Plan Holdings’ commercial health insurance business in New Hampshire.
The department has approved UnitedHealth Group Inc. (United), as the buyer. Health insurance is an integral part of the American healthcare system, and the proposed settlement will maintain competition for the sale of commercial health insurance to private employers in New Hampshire with fewer than 100 employees.
“Americans spend trillions of dollars on healthcare each year, and competition between health insurers is vital to providing consumers with access to quality care at affordable rates. This merger, as originally structured, likely would have led to higher prices, poorer quality, and reduced choice for many consumers throughout the state,” said Assistant Attorney General Makan Delrahim of the Antitrust Division. “Today’s settlement with its divestiture will ensure that small groups and CRC groups continue to benefit from the competition that has enabled them to purchase the health insurance plans for their employees at competitive prices in the state.”
“This case will play an important role in maintaining competition in New Hampshire’s health insurance industry,” said Scott W. Murray, U.S. Attorney for the District of New Hampshire. “By bringing this antitrust action, the Department of Justice is working to ensure that consumers in the Granite State have adequate and affordable health insurance options.”
“New Hampshire’s healthcare costs are among the highest in the country. It is an essential duty of the New Hampshire Attorney General to protect consumers of this State. Such protection requires ongoing and vigorous antitrust enforcement efforts,” said New Hampshire Attorney General Gordon J. MacDonald. “In this case, New Hampshire collaborated with our federal partner, the Antitrust Division of the United States Department of Justice, to protect consumers from an anticompetitive health insurance transaction that likely would have led to higher premiums and costs for consumers in the State. We believe the proposed settlement and remedy will restore any lessening of competition resulting from the proposed merger. We remain committed to using all available tools to protect New Hampshire consumers from higher healthcare costs.”
The Justice Department’s Antitrust Division, along with the New Hampshire Office of Attorney General, filed a civil antitrust lawsuit today in the U.S. District Court for the District of New Hampshire to block the proposed merger. At the same time, the department filed a proposed settlement that, if approved by the court, would resolve the competitive harm alleged in its complaint.
According to the department’s complaint, Harvard Pilgrim and Tufts Freedom are two of the three top commercial group health insurers that offer plans to two types of private employers in New Hampshire: (1) employers with between one and 50 employees (small groups) and (2) employers with between 51 and 99 employees (CRC groups). The department’s complaint alleges that since Tufts Freedom’s inception in 2016, competition between it and Harvard Pilgrim has resulted in lower premiums, richer plan benefits, and better service for small groups and CRC groups in New Hampshire.
Under the terms of the proposed settlement, Harvard Pilgrim and Health Plan Holdings must divest Tufts Freedom to United or to an alternative purchaser approved by the United States, and allow United the opportunity to hire key employees who operate Tufts Freedom. Harvard Pilgrim and Health Plan Holdings must also provide transition services and use best efforts to maintain Tufts Freedom’s contracts with healthcare providers during the transition to United.
The department has also closed its investigation into the merger’s potential effects in Massachusetts after concluding that the merger was unlikely to substantially lessen competition there.
Harvard Pilgrim is a regional health insurer based in Wellesley, Massachusetts. Its annual revenue in 2019 was approximately $3 billion, with the vast majority coming from commercial insurance products.
Health Plan Holdings is a regional insurer based in Watertown, Massachusetts. Its annual revenue in 2019 was over $5.5 billion, with roughly one-third coming from commercial insurance products. Health Plan Holdings sells commercial group health insurance plans to small and large employer groups in New Hampshire through Tufts Freedom.
As required by the Tunney Act, the proposed settlement, along with a competitive impact statement, will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to Eric Welsh, Chief, Healthcare and Consumer Products Section, Antitrust Division, U.S. Department of Justice, 450 Fifth Street NW, Suite 4100, Washington, DC 20530. At the conclusion of the 60-day comment period, the U.S. District Court for the District of New Hampshire may enter the final judgment upon finding it is in the public interest.
Justice Department Reaches Major Olmstead Settlement Agreement with North DakotaRead the Press Release
The Justice Department today announced a settlement agreement with the State of North Dakota under the Americans with Disabilities Act (ADA). The agreement resolves complaints alleging that North Dakota unnecessarily institutionalizes individuals with disabilities in nursing facilities, instead of providing them the services they need to live in the community.
“Today’s settlement is a great victory for the people of North Dakota and its government. The settlement agreement will ensure that individuals with disabilities are no longer unnecessarily institutionalized in nursing facilities. Instead, these individuals will be able to choose to remain in their own home, near family and friends,” said Assistant Attorney General Eric Dreiband for the Civil Rights Division. “We commend the State of North Dakota for making changes to its long-term care service system in a manner that will benefit both people with physical disabilities and their families, friends, and communities throughout the Peace Garden State. The settlement agreement is an important step towards inclusion, not just for the State, but as a model nationwide.”
“The settlement we reached ensures that thousands of North Dakotans with disabilities, including seniors, will have a meaningful choice for where they wish to live, including in their own private home,” said U.S. Attorney Drew Wrigley for the District of North Dakota. “That is the sacred promise of the Americans with Disabilities Act, and I commend our state partners who joined my office and the Department of Justice in securing for North Dakotans the right to age in place for today and all the years to come.”
Under the agreement, North Dakota will expand services to individuals with physical disabilities in, or at risk of entering, a nursing facility to allow them to live in their homes. The state will provide these services to more than 2,500 people with disabilities, helping them to assess their options, decide where they would like to live, and arrange for community-based services. These services include assistance in finding accessible housing and home health aides to help with daily activities such as bathing and dressing. As part of the agreement, North Dakota will also increase access to community-service providers.
Enabling people in nursing facilities, who choose and are appropriate for community-based care, to transition to the community is especially urgent during the COVID-19 pandemic, given the high risk of virus transmission in congregate settings.
July 26, 2020, marked the 30th Anniversary of the ADA. The Justice Department plays a central role in advancing the nation’s goal of equal opportunity, full participation, independent living, and economic self-sufficiency for people with disabilities. Please visit the department’s ADA Anniversary webpage to learn more about the ADA’s history and impact.
People interested in finding out more about the ADA or this settlement agreement can call the toll-free ADA Information Line at 800-514-0301 or 800-514-0383 (TDD), or access the ADA website at http://www.ada.gov.
Illegal Alien Who Unlawfully Possessed a Gun and Who Was Shot in Waterloo in 2000 Sentenced to Federal PrisonRead the Press Release
A Mexican man who had been a fugitive from justice for nearly 15 years was sentenced today to more than 3 years in federal prison.
Perpecto Rico-Perez, age 51, a citizen of Mexico, who was illegally present in the United States and living in Waterloo, Iowa, in the early 2000s, received the prison term after a July 21, 2020 guilty plea to one count of possession of a firearm by an illegal alien.
Information disclosed at sentencing and in a plea agreement showed that, on May 25, 2000, Rico-Perez and his brother went to Wildside Creationz, a former auto shop in Waterloo. While they were inside, an altercation ensued and Rico-Perez was shot in his right eye, his brother was shot in the chest and arm, and a third man was shot and killed. Law enforcement arrived and found close to two kilograms of cocaine inside the business.
Immediately following the shooting, Rico-Perez and his brother fled the scene and returned to Rico-Perez’s residence in Waterloo, where Rico-Perez’s young daughter called 911. In the late evening hours of May 25, 2000, law enforcement officers executed a search warrant at Rico-Perez’s residence. In a small cupboard above a bathtub in the bathroom, they recovered a .45 caliber handgun, which had been reported stolen less than six months earlier.
Rico-Perez was sentenced in Cedar Rapids by United States District Court Judge Linda Reade. Rico-Perez was sentenced to 37 months’ imprisonment. He must also serve a 3-year term of supervised release after the prison term. There is no parole in the federal system. Rico-Perez is being held in the United States Marshal’s custody until he can be transported to a federal prison.
The case was prosecuted by Assistant United States Attorney Matthew J. Cole and Special Assistant United States Attorney Dillan Edwards and investigated by the Waterloo Police Department, the Federal Bureau of Investigation, and the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
This case was brought as part of Project Safe Neighborhoods (PSN). PSN is the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please see /media/1122011/dl?inline.
Court file information at https://ecf.iand.uscourts.gov/cgi-bin/login.pl.
The case file number is 05-CR-02019.
Follow us on Twitter @USAO_NDIA.
Illegal Alien Sentenced to Five Years in Prison After Assaulting A Family with A FirearmRead the Press Release
Tampa, Florida – U.S. District Judge Virginia M. Hernandez Covington has sentenced Jose Luis Sanchez-Lule (age 37) to five years in federal prison for possession of a firearm by an illegal alien, and for illegal reentry into the United States after deportation. The court also ordered Sanchez-Lule to forfeit a firearm and ammunition.
Sanchez-Lule had pleaded guilty on September 3, 2020.
According to court documents, Sanchez-Lule assaulted a family as they were driving home from a trip to Cape Canaveral. On April 10, 2019, a man and woman took their 14-year-old son to Cape Canaveral for a rocket launch. After the launch was cancelled, the family began driving back to their home in Ft. Myers. At approximately midnight, the family stopped at a convenience store in Zolfo Springs and then resumed driving south on Highway 17. A few miles later, they saw a black SUV stopped on the shoulder on the opposite side of the road. When they passed it, the black SUV turned on its lights, made a U-turn, and began tailgating the family’s car with bright lights shining from the black SUV’s front grille. Thinking the black SUV could be a police vehicle, the family initially slowed down, but the SUV continued to drive aggressively near them. Realizing it was not a police car, the family made a U-turn back towards Zolfo Springs and called 911. The black SUV made a U-turn and followed them. After unsuccessfully trying to block the family’s vehicle, Sanchez-Lule pulled his SUV alongside the family’s car, lowered his window, and pointed a firearm at them. The family continued to drive at a high rate of speed into the city limits of Zolfo Springs. As they approached town, Sanchez-Lule slowed his SUV.
Deputies from the Hardee County Sheriff’s Office responded to the 911 call and saw the family’s car approaching town with the SUV following them. The deputies stopped the SUV and removed Sanchez-Lule, who was the only occupant in the vehicle. The deputies searched the SUV and found a rifle positioned where it was readily accessible to the driver, along with a box of ammunition. They also found a spent shell casing inside the SUV.
Sanchez-Lule is a citizen of Mexico. After being deported from the United States in 2012, he reentered the country without the consent of the Attorney General or the Secretary for the Department of Homeland Security.
“Removing dangerous criminal aliens like this from our communities is at the core of the mission for ICE’s Enforcement and Removal Operations (ERO),” said Miami ERO Field Office Director Michael Meade. “Thanks to an integrated law enforcement response, he will now be held accountable for his actions.”
“This case is an example of law enforcement partners working together with the goal of making our communities safer and HSI is proud to be part of this investigative effort,” said HSI Tampa Assistant Special Agent in Charge Michael Cochran.
This case was investigated by U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations and Enforcement and Removal Operations, the Bureau of Alcohol, Tobacco, Firearms and Explosives, the Hardee County Sheriff’s Office, and the Wauchula Police Department. It was prosecuted by Assistant United States Attorney Michael Sinacore.
Huntington Man Sentenced to Federal Prison for Drug CrimesRead the Press Release
HUNTINGTON, W.Va. – United States Attorney Mike Stuart announced today that Martel DaAngelo Brown, 33, of Huntington, was sentenced to 21 months in federal prison for two counts of distribution of fentanyl and one count of possession with intent to distribute fentanyl.
“We continue our work to reduce the supply of fentanyl and remove fentanyl dealers from our communities,” said United States Attorney Mike Stuart. “Fentanyl is a deadly drug that has taken the lives of many throughout our state.”
Brown previously pled guilty and admitted that on February 5 and 7, 2020, he distributed fentanyl in Huntington during controlled buys conducted by the Cabell County Sheriff’s Office and the FBI’s Southern West Virginia Transnational Organized Crime (TOC) West Task Force. On February 10, 2020, a search warrant of his Huntington residence yielded approximately 1.7 grams of fentanyl, digital scales, and a ledger.
The investigation was conducted by the Cabell County Sheriff’s Office and the FBI’s Southern West Virginia Transnational Organized Crime (TOC) West Task Force. United States District Judge Robert C. Chambers imposed the sentence. Assistant United States Attorney Ryan A. Keefe handled the prosecution.
The case was prosecuted as part of Operation Synthetic Opioid Surge (S.O.S.), an enforcement surge that seeks to reduce the supply of deadly synthetic opioids in high impact areas.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Southern District of West Virginia. Related court documents and information can be found on PACER by searching for Case No. 3:20-cr-00039.
Follow us on Twitter: SDWVNews and USAttyStuart
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High Point Man Convicted of Planning and Aiding and Abetting the Armed Robbery of Jewelry Stores in Elizabeth City and GarnerRead the Press Release
NEW BERN, N.C. – A federal jury convicted a High Point man Friday on charges of conspiracy to commit Hobbs Act robbery, two counts of Hobbs Act robbery, brandishing a firearm during and in relation to a federal crime of violence and witness tampering.
According to court records and evidence presented at trial, Charles Walker, Jr., a/k/a “Supreme,” 56, was convicted after a 5-day trial in New Bern. The case involved two Hobbs Act robberies at Kay Jewelry stores, one in Elizabeth City and one in Garner. The robbers were able to get away with almost $600,000.00 worth of jewelry. These were violent robberies as firearms were brandished during both robberies. During one of the robberies, a store employee was handcuffed behind her back and left in a backroom of the store. During the trial, the defendant took the stand and admitted during cross-examination that he is closely associated with a high-ranking blood member in Greensboro.
Walker is an extremely violent and dangerous individual. He was previously convicted of first-degree murder. He ultimately won a new trial and pled guilty to conspiracy to commit murder and accessory after the fact to murder after he had served 17 years in prison.
Walker faces a mandatory minimum of seven years and a maximum of life in prison when sentenced on February 26, 2021. Walker’s co-defendants – Christopher Brown, Malik Maynard, and Byron Sparks previously pled guilty and are awaiting sentencing. Another co-defendant, Joey Chambers, has already been sentenced by Judge Flanagan to 144 months in prison.
Robert J. Higdon, Jr., U.S. Attorney for the Eastern District of North Carolina made the announcement after U.S. District Judge Louise W. Flanagan accepted the verdict. The Federal Bureau of Investigation (FBI), the Elizabeth City Police Department, the Garner Police Department, and the Greensboro Police Department investigated the case. Assistant U.S. Attorneys Robert J. Dodson and Daniel W. Smith prosecuted the case.
Related court documents and information can be found on the website of the U.S. District Court for the Eastern District of North Carolina or on PACER by searching for Case No. 2:18-cr-00037-FL.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Hattiesburg Man Pleads Guilty to Tax FraudRead the Press Release
Hattiesburg, Miss. – Charles Chandler Smith, 43, of Hattiesburg, pled guilty today before Senior U.S. District Judge Keith Starrett to filing a false tax return, announced U.S. Attorney Mike Hurst and Internal Revenue Service Acting Special Agent in Charge James Dorsey of the IRS Criminal Investigation’s Atlanta Field Office.
According to the facts revealed at his plea hearing, in 2014, Smith took advantage of a tax deduction strategy to deduct money on his tax return and thereby reduce his taxable income. Smith transferred a total of $1,305,090 from an account held by his business, Lil Mad, to another company and falsely claimed it as a business expense deduction on his 2014 tax return. Smith falsely claimed that his income with Lil Mad was only $143,070. Smith admitted to knowing this act was unlawful or deliberately blinded himself to suspicious aspects of the deduction, particularly the fact that the money was soon transferred back to an account that was available to Smith for his personal use.
Smith will be sentenced on March 24, 2021 by Judge Starrett. He faces a maximum penalty of 3 years in prison and a $100,000 fine.
The case was investigated by IRS Criminal Investigation and the FBI. It was prosecuted by DOJ Health Care Fraud Trial Attorney Sara Porter and Assistant U.S. Attorney Kathlyn R. Van Buskirk.
Hampshire County man admits to child pornography chargeRead the Press Release
MARTINSBURG, WEST VIRGINIA – Jonathan Burgess, of Augusta, West Virginia, has admitted to a child pornography charge, U.S. Attorney Bill Powell announced.
Burgess, age 57, pled guilty to one count of “Possession of Child Pornography.” Burgess admitted to having child pornography images of a minor who hadn’t reached the age of 12 in Hampshire County in September 2019. 9 in Morgan County.
Burgess faces up to 20 years of incarceration and a fine of up to $250,000. Under the Federal Sentencing Guidelines, the actual sentence imposed will be based upon the seriousness of the offenses and the prior criminal history, if any, of the defendant.
Assistant U.S. Attorney Kimberley D. Crockett is prosecuting the case on behalf of the government. The West Virginia State Police investigated.
U.S. Magistrate Judge Robert W. Trumble presided.
Gang Member Pleads Guilty to Firearm CrimesRead the Press Release
NORFOLK, Va. – A Suffolk man pleaded guilty today to possessing a firearm while an unlawful user of controlled substances and possessing a firearm in furtherance of drug-trafficking crimes.
According to court documents, Antonio Lamon Jefferson, Jr., 25, is a member of the Suffolk-based street gang YNGI. YNGI members have been involved in a string of recent shootings. Jefferson has been arrested three times since April 2019 for possessing more than five pounds of marijuana, a rifle, multiple handguns, and about $35,000 in cash. Jefferson has been arrested twice at residences he used as drug premises—storing, packaging, and selling marijuana, hoarding drug proceeds, and arming himself at those locations to protect his drug trade. At one residence, he was armed with a handgun that had been reported stolen.
Jefferson is scheduled to be sentenced on April 2, 2021. He faces a mandatory minimum of five years in prison and a maximum of life in prison. Actual sentences for federal crimes are typically less than the maximum penalties. A federal district court judge will determine any sentence after taking into account the U.S. Sentencing Guidelines and other statutory factors.
This case is part of Project Safe Neighborhoods (PSN), a program bringing together all levels of law enforcement and the communities they serve to reduce violent crime and make our neighborhoods safer for everyone. The Department reinvigorated PSN in 2017 as part of a renewed focus on targeting violent criminals, directing all U.S. Attorney’s Offices to work in partnership with federal, state, local, and tribal law enforcement and the local community to develop effective, locally-based strategies to reduce violent crime.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Al Chandler, Interim Chief of Suffolk Police; Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office; and Col. K.L. Wright, Chief of Chesapeake Police, made the announcement after U.S. District Judge John A. Gibney Jr. accepted the plea.
Assistant U.S. Attorney William B. Jackson is prosecuting the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 2:20-cr-65.
Fort Pierre Man Indicted on Child Pornography ChargesRead the Press Release
United States Attorney Ron Parsons announced that a Fort Pierre, South Dakota, man has been indicted by a federal grand jury for Sexual Exploitation of a Child; Distribution of Material Involving the Sexual Exploitation of Minors; and Possession of Child Pornography.
James Cadwell, age 39, was indicted on November 10, 2020. He appeared before U.S. Magistrate Judge Mark A. Moreno on December 9, 2020, and pled not guilty to the Indictment.
The maximum penalty upon conviction is a mandatory minimum of 15 years up to 30 years in federal prison and/or a $250,000 fine, 5 years up to life of supervised release years of supervised release, and $100 to the Federal Crime Victims Fund. Restitution may also be ordered.
The Indictment alleges that on October 26, 2020, Cadwell knowingly produced, distributed, and possessed child pornography.
The charges are merely accusations and Cadwell is presumed innocent until and unless proven guilty.
The investigation is being conducted by the Federal Bureau of Investigation, the Pierre Police Department, the South Dakota Division of Criminal Investigation, and the South Dakota Internet Crimes Against Children Task Force. Assistant U.S. Attorney Michael J. Elmore is prosecuting the case.
Cadwell was remanded to the custody of the U.S. Marshals Service pending trial. A trial date has not been set.
Fort Defiance Woman Sentenced to Prison for Assault with a Dangerous WeaponRead the Press Release
PHOENIX, Ariz. – On November 19, Khadijha Louraye Keams, of Fort Defiance, Arizona, was sentenced by U.S. District Judge Michael T. Liburdi to eight years in prison, followed by three years of supervised release. Keams previously pleaded guilty to one count of assault with a dangerous weapon.
Keams admitted that in November 2019 she intentionally stabbed the victim multiple times in the chest and body with a knife before fleeing the scene. The assault took place on the Navajo Nation Indian Reservation, where Keams and the victim are tribal members.
The Federal Bureau of Investigation and the Navajo Nation Department of Criminal Investigation conducted the investigation in this case. Assistant U.S. Attorneys Kiyoko Patterson and Amy Chang, District of Arizona, Phoenix, handled the prosecution.
CASE NUMBER: CR-19-8262-PCT-MTL
RELEASE NUMBER: 2020-108_Keams# # #
For more information on the U.S. Attorney’s Office, District of Arizona, visit http://www.justice.gov/usao/az/
Follow the U.S. Attorney’s Office, District of Arizona, on Twitter @USAO_AZ for the latest news.Former bank branch manager sentenced to 3 years for embezzling funds from bank account of customer with dementiaRead the Press Release
U.S. Attorney Justin Herdman announced today that Audrey Ivers Whitworth, 26, of Rittman, was sentenced by U.S. District Court Judge Donald C. Nugent to 36 months of prison and two years of supervised release after she pleaded guilty to one count of bank embezzlement and one count of aggravated identity theft.
According to the indictment, from June 23, 2017, to August 5, 2019, while Whitworth was employed as a branch manager of a federally-insured bank, she embezzled approximately $84,000 by making unauthorized withdrawals from the account of an 84-year-old customer with dementia.
“This defendant stole over $80,000 from an 84-year-old woman who was suffering with dementia, said U.S. Attorney Justin Herdman. “This conduct is, quite simply, reprehensible and the severity of the defendant’s actions are reflected in this three-year prison sentence. Since it was founded 150 years ago, the Justice Department has been committed to protecting the most vulnerable among us, and our elderly friends, neighbors and loved ones are no exception.”
"This individual preyed upon and took advantage of an elderly person experiencing age related decline,” said FBI Special Agent in Charge, Eric B. Smith. “We all have people in our lives, many elderly - family, friends, neighbors, that we care for. We must pay special attention to our elderly population and hold individuals like Ms. Whitworth accountable for her despicable criminal behavior."
The investigation preceding the indictment was conducted by the Smithville Police Department and the Federal Bureau of Investigation, Canton Resident Agency. The case was prosecuted by Assistant U.S. Attorney Brian McDonough.
This case was brought as part of the Department of Justice’s Elder Justice Initiative, a nationwide initiative to combat the growing epidemic of elder fraud and abuse, launched in October 2017 by the Department of Justice. Led by U.S. Attorneys’ Offices, the Elder Justice Initiative marshals federal, state and local resources to support and coordinate the Department’s enforcement and programmatic efforts to combat elder abuse, neglect, financial fraud, and scams that target our nation’s seniors. For more information about the Elder Justice Initiative, please visit https://www.justice.gov/elderjustice.
Former Police Officer Sentenced to Prison for Drug ConspiracyRead the Press Release
NEWPORT NEWS, Va. – A former Hampton police detective was sentenced today to six years in prison for conspiring to distribute more than 500 grams of cocaine.
According to court documents, Deangelo Freeman, 32, conspired with local drug dealers while he was a detective in the Special Investigations Unit of the Hampton Police Division. Specifically, Freeman was associated with a number of individuals who were selling large quantities of cocaine. These individuals included Alex Burnett who owned 9Rounds Gym in Hampton Town Center. Freeman admitted to providing information to Burnett about an ongoing federal criminal investigation. Freeman learned of this information while serving as a narcotics detective and participating in the investigation of Burnett. The information provided by Freeman included the identity of a confidential informant. Freeman provided the information to compromise the investigation and to help Burnett’s drug distribution activities.
G. Zachary Terwilliger, U.S. Attorney for the Eastern District of Virginia; Brian Dugan, Special Agent in Charge of the FBI’s Norfolk Field Office; and Terry L. Sult, Chief of Hampton Police Division, made the announcement after sentencing by Chief U.S. District Judge Mark S. Davis.
Assistant U.S. Attorney Eric M. Hurt prosecuted the case.
A copy of this press release is located on the website of the U.S. Attorney’s Office for the Eastern District of Virginia. Related court documents and information are located on the website of the District Court for the Eastern District of Virginia or on PACER by searching for Case No. 4:17-cr-111.
Former FBI Official Pleads Guilty to Receiving Bribes and Falsifying Tax ReturnRead the Press Release
POCATELLO – Former Federal Bureau of Investigation official James Heslep, 51, of Gainesville, Virginia, pleaded guilty to receiving a bribe by a public official and making and subscribing a false federal income tax return, U.S. Attorney Bart M. Davis announced today. Heslep pleaded guilty to a two-count criminal information filed in connection with his plea agreement. Sentencing is set for March 17, 2021, before U.S. District Judge B. Lynn Winmill at the federal courthouse in Boise. In October 2020, Robert Bailey, 63, of Centreville, Virginia, pleaded guilty to paying a bribe to a public official. Bailey’s sentencing has been rescheduled to March 23, 2021.
According to court records, Heslep was a Management and Program Analyst with the FBI. In that position, Heslep was responsible for managing construction and services contracts for FBI buildings across the country.
According to court records, in 2001, Bailey, purchased L-1, a construction management and operations company located in Chantilly, Virginia. In 2008, Heslep and Bailey became business acquaintances when they worked together on an FBI construction project.
According to court records, in 2017, the FBI broke ground on the construction of a data center in Pocatello, Idaho (the Pocatello Data Center project). The Pocatello Data Center project involved construction of a two-building, 140,000 square-foot complex that would accommodate data halls containing computer equipment and office space. The purpose was to consolidate multiple FBI data centers from across the country and improve efficiency and cyber-security. In 2017, Heslep became the Contracting Officer Representative (COR) for the Pocatello Data Center project. In that position, Heslep had management and oversight responsibilities over the construction of the Pocatello Data Center.
According to court records, from 2016 through 2018, Bailey and L-1 made illegal payments, and gave items of value, to Heslep. These payments included 18 deposits totaling $120,000 into a bank account controlled by Heslep. From this account, Heslep made payments on a personal loan, home mortgage, car, credit card, and vacation travel payments, among other personal expenditures at retail stores, such as a pair of diamond earrings that cost $5,300. In addition, Bailey and L-1 provided the following items of value to Heslep: a fiftieth birthday party in Dallas, Texas, including first-class airfare, hotel accommodations, and tickets to a Dallas Cowboys football game; a beach house rental in Nags Head, North Carolina; first-class Amtrak train tickets; invitations to a L-1 company holiday party; and tickets to a Washington Nationals baseball game, among other gratuities. The total value of the unlawful payments and gratuities was $128,128.
According to court records, Bailey and L-1 made these payments, and gave these items of value, to Heslep with the intent to influence Heslep in performing official acts at FBI to benefit L-1 on the Pocatello Data Center project. These official acts included the following: Heslep seeking and receiving authorization for approximately $16,000 monthly per diem payments from the FBI to Bailey for L-1 employees who stayed at Bailey’s house instead of a hotel; Heslep soliciting and including Bailey’s edits in the statement of work to a $12.2 million construction and services bridge contract (related to the Pocatello Data Center project) that the FBI later awarded to S-1 (as general contractor) and L-1 (as subcontractor); and Heslep convincing his FBI superiors to pay L-1 for its work on the bridge contract at higher Washington, D.C. metropolitan-area labor rates, rather than lower Idaho labor rates. The Washington D.C. labor rates were approximately 30 percent greater than the Idaho labor rates.
“Public officials take a solemn oath not to exploit their office for personal gain,” said U.S. Attorney Davis. “Mr. Heslep disregarded his ethics training, purposely violated that oath, and compromised the FBI’s contracting process. This case stands as a cautionary warning for other public officials entrusted with influence over government contracts.”
“We trust public officials to do their work with integrity and honesty. Instead, Heslep abused his position. He accepted bribes of cash, sports tickets, and other items of value in exchange for granting favorable contracting terms. The Office of the Inspector General will continue to root out this kind of behavior,” said Douglas B. Bruce, Special Agent in Charge of the Department of Justice Office of the Inspector General Denver Field Office.
“James Heslep’s guilty plea is a win for American taxpayers,” said IRS – Criminal Investigation Special Agent in Charge Andy Tsui. “Heslep’s abuse of his position of trust is an insult to all who work ethically to best serve the United States. IRS – Criminal Investigation will continue to seek out and hold accountable those who attempt to abuse the system and use government funds for their own personal gain.”
The charge of receiving a bribe by a public official is punishable by up to 15 years in federal prison, a $250,000 fine or not more than three times the monetary equivalent of the thing of value, whichever is greater, disqualification from any office of honor, trust, or profit under the United States, and up to three years of supervised release. The charge of making and subscribing a false federal income tax return is punishable by up to three years in federal prison, a $250,000 fine, and up to one year of supervised release.
This case was investigated by the Department of Justice Office of the Inspector General and Internal Revenue Service – Criminal Investigation.
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The year 2020 marks the 150th anniversary of the Department of Justice. Learn more about the history of our agency at www.Justice.gov/Celebrating150Years.
Former Defense Department Official Arrested on Federal Charges of Taking Cash to Aid Contractor’s Request for $6.4 Million PaymentRead the Press Release
LOS ANGELES – Federal authorities have arrested a former Department of Defense civilian official on charges that he took $34,000 in illegal cash payments from a private contractor to support the contractor’s effort to obtain $6.4 million from the government in connection with construction projects on a Navy base in the African nation of Djibouti, the Justice Department announced today.
Nizar Farhat, 63, of Palm Desert, who was a former construction manager based at the Marine Corps Air Ground Combat Center in Twentynine Palms, appeared this morning in United States District Court in Charleston, South Carolina, where a judge set his bond at $75,000. Farhat was arrested on Friday by FBI agents in Mount Pleasant, South Carolina, where he has been staying in recent months.
Farhat is charged in a two-count indictment returned by a federal grand jury on December 4 that charges him with being a public official receiving an illegal gratuity and being a public official receiving compensation from a private party for government services.
In 2014 and 2015, Farhat was on assigned temporary duty at the United States Navy Base Camp Lemonnier in Djibouti, where he oversaw a private company’s $15 million contract to construct an aircraft hangar and a telecommunications facility. After the projects were completed, the company submitted to the Defense Department Requests for Equitable Adjustment (REAs) that sought $6.43 million in additional payments.
The indictment alleges that Farhat accepted $20,000 in cash from the company for performing official acts, specifically recommending that the Navy certify completion of the construction projects and pay the additional $6.43 million the company requested in the REAs. The indictment also alleges that Farhat took another $14,000 in cash from the company as compensation for advising the company and drafting the REAs submitted to the Defense Department.
The vast majority of the REAs remain under review by the Defense Department.
An indictment contains allegations that a defendant has committed a crime. Every defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.
If convicted of both charges, Farhat would face a statutory maximum sentence of seven years in federal prison.
This matter was investigated by the FBI and Naval Criminal Investigative Service.
This case is being prosecuted by Assistant United States Attorney David T. Ryan of the Terrorism and Export Crimes Section.
Feds Charge Man for Carjacking That Led to MurderRead the Press Release
LOUISVILLE, Ky. – A Vine Grove, Kentucky man, who carjacked and murdered one person in Louisville has been arrested and charged with carjacking, announced United States Attorney Russell Coleman.
“This is exceptional police and prosecutorial work by lawmen and women who take their oath to protect all Kentuckians seriously,” said U.S. Attorney Russell Coleman.
Ashton Clay Nally, 20, of Vine Grove, Kentucky, was arrested on Sunday December 13, 2020, in Madisonville, Kentucky.
According to the criminal complaint, On November 23, 2020, LMPD received a 911 call of a shooting, which occurred at a home on Crittenden Drive, in Louisville, KY. Upon LMPD’s arrival, they located the victim, lying in the roadway outside the home, who had sustained three gunshot wounds. The victim was transported to a nearby hospital where he was pronounced dead.
Upon investigation, LMPD obtained video surveillance and a witness account from a nearby residence. While reviewing the video, an unknown individual can be observed approaching the victim. An argument can be overheard between the two. Three shots can be heard. The victim falls backwards into the roadway while the unknown individual enters the driver’s seat. The unknown individual flees the area in the vehicle at a high rate of speed.
LMPD located the victim’s vehicle, a 2016 Mazda CX-5, at the intersection of Lynn Street and Emmet Avenue where it had wrecked into another vehicle, which was parked on Lynn Street. A search of the vehicle was conducted by LMPD. During the search, a pair of glasses were located on the dashboard. These glasses were identified as having brown metal frame imprinted with MM 5105 BR 52-17-140. The right lens was removed from the frame and lying on the dashboard beside the frame. It appeared whenever the unknown individual wrecked, his glasses had fallen off and the impact caused the right lens to exit the frame.
According to the complaint, on November 30, 2020, LMPD received an anonymous online tip. This tip advised the defendant, Nally, had shot and killed the victim. The tipster also advised after the shooting Nally fled the area in the victim’s vehicle, crashing it nearby. Nally then fled on foot down Preston Highway where he threw the pistol used during the Carjacking onto a roof near the White Castle. LMPD had conducted a neighborhood canvass in the area of the wreckage. During this canvass, LMPD located video footage, which did depict Nally running towards Preston Highway.
On December 2, 2020, LMPD received a second tip that Nally admitted to another individual that he had killed the victim during the carjacking.
The federal carjacking charge carries a maximum sentence of death, a fine of $250,000, and no more than three years of supervised release.
A federal complaint is a written statement of the essential facts of the offense charged and must be made under oath before a U.S. Magistrate Judge. The charge set forth in a complaint is merely an accusation and the defendant is presumed innocent until proven guilty beyond a reasonable doubt in a Court of law.
The case is being prosecuted by Assistant United States Attorney Tom Dyke. The FBI Louisville Field Office and Louisville Metro Police Department are investigating this case.
This case falls with the purview of the federal carjacking task force formed in August of 2020 as carjackings in Louisville skyrocketed. The partners on the task force include: The Federal Bureau of Investigation (FBI), Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF), Homeland Security Investigations (HIS), the Louisville Metro Police Department, the Kentucky State Police, the Jefferson Co. Sheriff’s Office, and the United States Attorney’s Office.
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Fairbanks Man Sentenced to 9 Years in Federal Prison for Possession of Stolen Firearm and Methamphetamine TraffickingRead the Press Release
Anchorage, Alaska – U.S. Attorney Bryan Schroder announced Brian James Tepner, 48, of Fairbanks, Alaska, has been sentenced to 108 months in federal prison followed by 8 years of supervised release on charges of possession with intent to distribute methamphetamine and for being a felon in possession of a stolen firearm.
At 3:30 a.m. on March 22, 2019, Tepner was found slumped over in the driver’s seat of a vehicle parked at a Sourdough Fuel station in Fairbanks. Alaska State Troopers saw an open container of alcohol, hypodermic needles, and a spoon with burnt heroin residue in plain view during the contact. Troopers obtained a search warrant for the vehicle and seized 191 grams of methamphetamine, three grams of heroin, and a stolen S&W .22 caliber pistol. Troopers also located drug dealing paraphernalia, including ledgers, two scales, and multiple plastic baggies and cell phones. Tepner was apprehended, but left Alaska shortly after being released.
Tepner was indicted by a Grand Jury in the District of Alaska on May 22, 2019. On June 25, 2019, he was arrested in Phoenix, Arizona and transported back to Alaska.
In imposing the 108-month sentence, the Court noted Tepner’s long criminal record and recent threats he made towards his wife on recorded jail calls as justifying the lengthy sentence.
The Federal Bureau of Investigation (FBI), Alaska State Troopers (AST), and the Fairbanks Area Narcotics Team conducted the investigation leading to the sentence in this case. The Fairbanks Area Narcotics Team is part of Alaska’s High Intensity Drug Trafficking Areas (HIDTA) program. Established in 2018, the Alaska HIDTA Program enhances and coordinates efforts among local, state, and federal law enforcement agencies, providing equipment, technology, and additional resources to combat drug trafficking and its harmful consequences in critical regions of Alaska. The case was prosecuted by Assistant U.S. Attorney Ryan Tansey.
This case is part of Project Safe Neighborhoods (PSN), the centerpiece of the Department of Justice’s violent crime reduction efforts. PSN is an evidence-based program proven to be effective at reducing violent crime. Through PSN, a broad spectrum of stakeholders work together to identify the most pressing violent crime problems in the community and develop comprehensive solutions to address them. As part of this strategy, PSN focuses enforcement efforts on the most violent offenders and partners with locally based prevention and reentry programs for lasting reductions in crime.
This case is also part of Project Guardian, the Department of Justice’s signature initiative to reduce gun violence and enforce federal firearms laws. Initiated by the Attorney General in the fall of 2019, Project Guardian draws upon the Department’s past successful programs to reduce gun violence; enhances coordination of federal, state, local, and tribal authorities in investigating and prosecuting gun crimes; improves information-sharing by the Bureau of Alcohol, Tobacco, Firearms and Explosives when a prohibited individual attempts to purchase a firearm and is denied by the National Instant Criminal Background Check System (NICS), to include taking appropriate actions when a prospective purchaser is denied by the NICS for mental health reasons; and ensures that federal resources are directed at the criminals posing the greatest threat to our communities. For more information about Project Guardian, please visit https://www.justice.gov/ag/about-project-guardian
Ex-Skyworks Solutions Semiconductor Engineer Sentenced to 18 Months in Federal Prison for Committing Insider TradingRead the Press Release
LOS ANGELES – A former semiconductor engineer was sentenced today to 18 months in federal prison for committing insider trading when he obtained his publicly traded employer’s non-public financial results without authorization and then illegally used the confidential information to purchase large amounts of stock prior to the information’s release.
Yuh-Yue Chen, 53, of Taiwan, was sentenced via videoconference by United States District Judge Percy Anderson, who also ordered Chen to pay a $6,000 fine. Chen pleaded guilty on October 1 to one count of securities fraud.
Chen was an electrical engineer at Skyworks Solutions Inc., a publicly traded Woburn, Massachusetts-based semiconductor company with a branch office and design center in Irvine. During the spring and summer of 2014, Chen bought Skyworks stock and options based on confidential information not yet available to the public.
Specifically, Chen used his employee security badge to gain unauthorized access to the company’s restricted office area for the accounting and financial staff. Once inside, Chen went through the desks and work areas to find the company’s non-public earnings reports. Using this confidential information, Chen bought large amounts of Skyworks securities. Once Skyworks released its earnings reports to the public, Chen sold his Skyworks securities for a profit.
In September 2014, Chen left the United States for Taiwan five days after two Skyworks employees caught him rifling through company documents in the restricted accounting and finance office, according to court papers. Soon afterward, Skyworks fired him.
Through this insider trading scheme, Chen received more than $700,000 in illegal profit.
In a lawsuit brought by the Securities and Exchange Commission, Chen was ordered to pay a $739,959 judgment to the SEC stemming from his insider trading scheme while he was employed at Skyworks Solutions.
In March 2019, law enforcement interviewed Chen at Los Angeles International Airport, where he admitted to committing insider trading, according to court documents.
The FBI investigated this matter.
Assistant United States Attorney Jennifer L. Waier of the Santa Ana Branch Office prosecuted this case.